Chancellor’s tax grab spurs record outflows from equity funds______

Equity funds suffered their worst month of outflows on record in October. Investors sold down a net £2.71bn of their holdings, with every category of equity funds seeing outflows. The sharp outflows in October followed a weak September, which itself had seen the first outflows since October 2023.
Key highlights from this month’s FFI:

  • Investors withdrew a net £2.71bn from funds in October – a record high, following early selling activity in September
  • Sell orders surged 36% month-on-month but dropped 40% overnight as Capital Gains Tax hikes took effect on Budget Day
  • Buying activity also rose sharply – indicating reinvestment of some of the proceeds
  • Clear indication that investors sought to crystallize profits at lower CGT rates
  • UK-focused funds bore the brunt of the selling, but every equity-fund sector saw outflows
  • Global funds saw their first outflows in more than two years
  • Bond funds saw highest inflows since June 2023 and safe-haven money market funds also saw net buying

View this edition of the FFI in full

View this edition of the FFI in full

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