You are here: Home - Investing - Experienced Investor - News -

Investors pumped record amounts into equity funds in April as markets rallied

Written by:
Investors flocked back to equity funds in April as stock markets rebounded after sharp falls in February and March.

A record £2.6bn flowed into funds during the month, following two months of money leaving the sector as the Covid-19 pandemic ravaged the global economy and shattered market confidence month, according to fund technology firm, Calastone.

Most of the buying took place in the middle of the month as evidence began to emerge that the outbreak was beginning to slow down in some of the worst-hit European countries. By the end of the month, inflows slowed to a trickle, Calastone said.

Global funds took in the most new money, adding a total of £1.1bn, easily the best month on record for the sector.

Funds focused on UK equities were close behind, adding £1bn, the second-best month ever seen for these funds.

Asian funds enjoyed their first inflows since November, while outflows from European funds slowed to their second lowest level since the end of 2018.

Fixed income funds enjoyed a better month after an unprecedented £3.6bn of outflows in March. In total, these funds took in £461m of investor money in April.

Edward Glyn, head of global markets at Calastone, said: “Fear receded in April and capital flooded back into funds in its wake. As markets began to rise sharply, investors scrambled to add to their fund holdings, eager not to miss the best month for markets in 40 years.

“Greater caution set in later in month, perhaps because investors began to question how solid the foundations of the rally could be given the mounting evidence of severe economic damage around the world, as well as White House sabre-rattling over new tariffs on China.

“Bear markets are often punctuated by brief moments of euphoria that see share prices inflate rapidly. But just as it is easier to puncture a balloon than knock down a wall, bear market rallies often deflate just as quickly as they occur.

“We don’t pretend to know which way share prices are going, but the slowdown in inflows suggests the uptick may at best be on pause for now.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Seven ways to get help with energy bills this winter

We knew today’s announcement was going to be painful, but it’s still a shock to the system. When this kick...

Flight cancelled or delayed? Your rights explained

With no sign of the problems in UK aviation easing over the peak summer period, many will worry whether holida...

Rail strikes: Your travel and refund rights

Thousands of railway workers will strike across three days this week, grinding much of the transport system to...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week