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Experienced Investor

UK still popular in first month of New Isa

Cherry Reynard
Written By:
Cherry Reynard
Posted:
Updated:
01/09/2014

In the first month of the enlarged £15,000 New ISA (NISA) allowance, Tilney Bestinvest said UK All Companies funds were the most popular choice for its clients.

Managing Director Jason Hollands said the sector represented 14% of inflows: “The top choices of our self-directed investors were Liontrust Special Situations, AXA Framlington UK Select Opportunities, AXA Framlington UK Mid Cap, JO Hambro CM UK Opportunities and the HSBC FTSE 100 Index fund.”

UK Equity Income funds were a close-run second place, drawing 13% of client inflows. Hollands added: “Here the standout top choice was Threadneedle UK Equity Income fund. This was followed by the CF Woodford Equity Income fund, a new fund launched in June by former Invesco Perpetual manager Neil Woodford to much fanfare. Other popular choices were Artemis Income and Schroder Income Maximiser.”

Hollands said that flexible bond funds were also in favour in spite of concerns over interest rate rises. “With interest rates currently at a record low but expected to rise over the coming year, we have long signalled the prospect of future adjustments in the bond markets that could mean higher yields but lower bond prices are to come,” he said. “For some time we have highlighted the merits of strategic bond funds, those which have a significant degree of flexibility to adapt to changes. Such funds represented 11% of our client purchases since the launch of the NISA. Here the most popular funds were Kames Strategic Bond fund, M&G Optimal Income Fund, Henderson Strategic Bond, PFS Twenty Four Dynamic Bond and Fidelity Strategic Bond.”

There was a notable trend towards increasing caution, possibly as a result of the geopolitical tension in Ukraine, Gaza, Iraq and Libya. As a result Targeted Absolute Return funds also proved popular. Almost half of inflows into such funds went into the Standard Life Investments Global Absolute Return Strategies fund. Other popular choices in this area were Threadneedle UK Absolute Alpha, Insight Absolute Insight, Jupiter Absolute Return and FP Argonaut European Absolute Return.

20 most popular funds for Tilney Bestinvest clients since the launch of the New ISA, including fund sector:

1 Standard Life Inv Global Absolute Return Strategies – Targeted Absolute Return
2 Threadneedle UK Equity Income – UK Equity Income
3 Kames Strategic Bond – £ Strategic Bond
4 Liontrust Special Situations – UK All Companies
5 HSBC American Index – North American
6 Henderson UK Property – Property
7 M&G Optimal Income – £ Strategic Bond
8 AXA Framlington UK Select Opportunities – UK All Companies
9 CF Woodford Equity Income Fund – UK Equity Income
10 Henderson Strategic Bond Fund – £ Strategic Bond
11 Threadneedle European Select Fund – Europe ex UK
12 Newton Global Higher Income – Global Equity Income
13 IFSL – Bestinvest Growth Portfolio – Unclassified (Multi-Asset)
14 Threadneedle UK Absolute Alpha – Targeted Absolute Return
15 AXA Global High Income – £ High Yield
16 First State Asia Pacific Leaders Fund – Asia Pacific ex Japan
17 Henderson European Focus – Europe ex UK
18 AXA Framlington UK Mid Cap – UK All Companies
19 Old Mutual UK Select Smaller Companies – UK Smaller Companies
20 JO Hambro UK Opportunities – UK All Companies