Responsible investment funds under management up 66 per cent over 12 months

UK savers put almost GBP1 billion a month on average into responsible investment funds in 2020, new statistics published today by the Investment Association (IA) reveal, while net retail sales into responsible investment funds in January 2021 reached GBP1.2 billion.

The IA has for the first time published more detailed responsible investment fund data in line with the IA’s 2019 Responsible Investment Framework, to provide investors with more insight into this rapidly growing area of the fund market and help them compare funds. This new data will be published on a quarterly basis going forward and includes:

Of the GBP1.2 billion invested in responsible investment funds in January, GBP703m was invested in equity funds, GBP180 million was invested in bond funds and GBP241m was invested in mixed asset funds. Total net retail sales over the last 12 months were GBP12.4 billion – 43 per cent of total net sales.

Over the last 12 months, responsible investment equity funds made up the highest proportion of flows, with average monthly sales of GBP510 across the time period.

Responsible investment funds under management now total over GBP56 billion, growing 66 per cent over the past 12 months, in comparison to 7 per cent across funds overall.

Almost 60 per cent of the GBP56 billion is invested in equity funds, with 20 per cent in bond funds and 20 per cent in mixed asset funds.

Some 66 per cent of responsible investment funds under management have a sustainability focus and 72 per cent exclude certain types of investments, with 42 per cent doing both.

In January 2021 across the broader fund market, net retail sales maintained a strong GBP3.2 billion inflow. 

Chris Cummings, Chief Executive of the Investment Association, says:“Responsible investment funds continue to capture investors’ imagination, reaching more than 40 per cent of all net sales over the last year. This growth is indicative of how important investing with environmental, social and governance considerations in mind has become.

“Across the wider fund market, savers started the New Year in a quietly optimistic mood, as they placed a strong GBP3.2bn into funds in January. As the COVID vaccine optimism that buoyed stocks and shares funds at the end of 2020 began to wane, equity fund sales were down month on month as investors opted for bond funds in January.”

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