According to the IMA, net retail sales for September stood at £568m overall compared with £2.6bn for the same period in 2010.
Sales in July and August were also disappointing. They stood at £936m and £1.1bn respectively, well below the monthly average of £2.1bn over the last 12 months.
Sales and AUM in IMA universe in 2011 and 2010
| Funds under management (£) |
Net retail sales (£) |
|
| September 2011 |
546.7bn |
568m |
| September 2010 |
550.9bn |
2.6bn |
Source: The IMA
"September’s further slowdown in fund sales confirms the trend of the previous two months," said Richard Saunders, chief executive at the IMA. "As a result, net retail sales in the third quarter were the lowest since 2008."
The top-selling sector was the Sterling Corporate Bond fund, followed by UK Equity Income and Cautious Managed. UK Gilts were the fifth most popular sector.
"Investors were cautious in their asset class choices in September, with bonds and balanced funds the best-selling assets," commented Saunders. "There was a modest outflow from equities overall, although UK equity income funds continued to attract investors."
The data follows a recent FE Trustnet article that showed giant funds such as the Fidelity Global Situations and Jupiter Financial Opportunities have been experiencing heavy outflows over the course of the last year.
"People have been understandably nervous," said Juliet Schooling-Latter, head of research at Chelsea Financial Services. "The market has been so volatile and it is putting people off. The dips have been good buying opportunities for long-term investors but the markets have been held hostage by European politicians."
Industry analysts have said that the eurozone rescue plan could be the catalyst that takes the brakes off the equity market and puts an end to the volatility.
However, Schooling-Latter believes there are still some unresolved issues on the continent which could see the region run into further difficulty.
"Today could be the turning point but we’ll only be able to tell with hindsight," said Schooling-Latter. "It could just end up being nothing more than a sticking plaster until the next major economy runs into hot water."
Fidelity chief investment officer Dominic Rossi recently told FE Trustnet that Italy’s debt-to-GDP ratio was still unsustainable.
Schooling-Latter warns that investors might be wise to take a cautious approach in the coming months as the impact of the rescue package is realised.
"I’ve been treading rather carefully in recent months and sold a lot of my riskier assets," she said. "I’m holding a hefty percentage in cash, waiting to see exactly how things pan out."
"On the other hand, we’ve also had a fair few clients ring up to buy into the equity market now that they are satisfied that there is some certainty," she finished.