Interactive Investor

The fund groups bucking the trend as withdrawals hit record high

Kyle Caldwell reports on figures that show which fund groups were most popular among investors in 2023.

12th February 2024 10:59

by Kyle Caldwell from interactive investor

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A pound symbol representing fund flows 600

It was a year to forget for fund firms, as 2023 marked a new record for investor withdrawals.

This is according to the latest Pridham Report, which has monitored fund sales and asset trends among UK investors for more than 20 years. It noted that the UK fund industry suffered its worst year on record for net outflows. Net sales are assets remaining after investor withdrawals, while gross sales take into account only new money invested.  

The gross sales picture is rosier, with the amount invested last year higher than in 2022, but below peak levels in the two years prior.

BlackRock takes the top spot on both gross and net retail sales for its fund range, attracting £30.2 billion and £6.4 billion.

The report notes that Legal & General Investment Management had a strong year as it reported a 26% rise in gross sales compared to 2022. It takes the third spot for net retail sales, with £3.1 billion invested.

Fidelity and HSBC Asset Management follow in third and fourth place for gross sales, amassing £15.2 billion and £13 billion.

Across the four groups, 71% of new flows went into passive funds. This is the same as what we’ve seen on the interactive investor platform, with index funds or exchange-traded funds (ETFs) proving popular. Among the top 10 most-bought funds in January, seven are passive, with the three most popular being Vanguard LifeStrategy 80% Equity, Vanguard US Equity Index and HSBC FTSE All-World Index.

Vanguard, the passive giant, does not appear in the Pridham Report due to not providing its figures.

Royal London Asset Management was the top-ranked active fund manager for both gross and net sales. The report notes that while in previous years the fund firm has seen the highest inflows into its sustainable funds, in 2023 its bestsellers were short-dated fixed income and money market funds.

M&G and BNY Mellon were new entrants in the top 10 for gross new business. The report points out that M&G's Japan fund ranked among the bestselling retail funds of 2023, and the M&G Emerging Markets Bond fund was another top seller. Elsewhere, the BNY Mellon Multi-Asset Balanced fund garnered attention as a top choice among retail investors.

According to Anna Pridham, editor of the Pridham Report, this distinction between gross and net flows is important. Pridham says: “Gross sales show that established groups such as Schroders, Jupiter, BNY Mellon and JPM are attracting significant new flows. However, as mature businesses, they also contend with high levels of natural outflows and switches.”

Top 10 managers by gross retail sales in 2023 (£m) 

Fund firm Amount 
BlackRock £30,187.60
Legal & General Investment Management £20,572.40
Fidelity £15,163.80
HSBC Asset Management £12,950.10
Royal London Asset Management £11,310.00
M&G £7,788.90
Schroders£5,822.30
Jupiter £5,083.20
BMY Mellon £5,058.20
JP Morgan Asset Management £4,768.40

Source: The Pridham Report.

These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

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