December 2019 sees largest ever inflow into UK equity funds thanks to Conservative Party’s landslide election victory ______

07 Jan 2020

A dramatic turnaround in confidence saw UK investors pour more capital back into equity funds in December 2019 than at any other time in the last two years, according to the latest Fund Flow Index from Calastone, the largest global funds network. A net £2.0 billion flowed into the sector, making it the fifth best month on record; half of this capital was directed towards UK-focused funds, with the rest mainly directed towards global and North American funds. The FFI: Equity soared to 56.7, its highest level in two and a half years (a reading of 50 means inflows exactly balance outflows). For most of 2019 the index had been neutral or negative.

Key highlight’s from this month’s FFI:

  • Equity funds overall enjoyed strongest inflows in 2 years in December, following a lacklustre year for the sector
  • UK-focused funds absorbed an unprecedented £1bn in new capital in December, half the total flowing into equity funds overall
  • December’s inflow to UK-focused funds was twice the previous monthly record set in July 2015
  • Victory for the Conservative Party explains the dramatic increase in appetite for much undervalued UK assets – after election day flows into UK-focused funds almost tripled from already elevated levels

To read further insights from the FFI, please click through this link

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