LONDON (Reuters) - UK mutual funds have shed 18 percent of assets in the last 12 months, data shows, pointing to a crisis of investor confidence over low oil prices, fears of Chinese recession and Britain’s vote on European Union membership.
The Thomson Reuters Lipper data, based on investment flows in UK Investment Association (IA) fund categories, showed a 38 billion pound ($54 billion) drop in the year to end-May, with nearly 16 billion pounds of net outflows in January alone.
In a turbulent year, most of the world’s most popular asset classes have been sapped by concerns about the world economy and political upheaval, including Britain’s possible EU exit.
British citizens will vote on June 23 on whether to remain in the EU.
The unpredictable outcome, combined with uncertainty as to how complicated and destabilising a divorce from EU partners could be, has led some investors to slash exposure to British stock, bond and property markets.
The UK All Companies funds sector, with some 12 percent of all IA assets, suffered a yearly net outflow of 9.2 billion pounds, while nearly 12 billion pounds flowed out of the IA Sterling Strategic Bond sector to end-May, without a single monthly net inflow for the year.
Only four of the IA sectors attracted more than 1 billion pounds of net inflows in the year to end-May: Property, Global Equity Income, Global Bonds, and Targeted Absolute Return.
Targeted Absolute Return attracted almost 10 billion pounds of net inflows, as investors flocked to funds designed to make money in all market conditions.
($1 = 0.7050 pounds)
Reporting by Sinead Cruise; Editing by Ruth Pitchford