IFAs are much more positive about the prospects of UK companies than they were this time last year, according to research.
The data from Lincoln Financial Group also shows advisers are more evenly weighted in their choice between value and growth stocks.
In January 2007, IFAs accounted for £177.3m net sales in UK All Companies funds and a net £180.7m in UK Equity income funds.
But in January 2006, IFAs were more biased towards value stocks, selling a net £75.3m of UK All Companies funds but a net £109m of UK Equity Income products.
The figures also show that overall net sales of UK stockmarket funds by IFAs nearly doubled over the year from a combined £184.3m in January 2006 to £358m this year.
IFAs’ appetite for UK stocks was in contrast to other distribution channels. There were net withdrawals of £38.7m from UK All Companies funds sold by sales force and tied agents, although there were positive net sales of £5.6m in UK Equity Income.
In addition, there were net withdrawals of £93.9m and £33.6m from UK All Companies and UK Equity Income funds respectively sold direct to the public.
Funds in the UK All Companies sector invest at least 80% of their assets in UK equities that have the primary objective of achieving growth.
UK Equity income funds invest at least 80% of their assets in UK equities aiming to achieve a yield in the underlying portfolio in excess of 110% of the FTSE All-Share yield (net of tax).
Andy Wills, head of Investment Sales & Marketing at Lincoln Financial Group, says: “Our analysis shows that IFAs are much more bullish on UK companies than their sales force and tied agent peers.
“This points to their greater confidence in the UK economy and IFAs are right to be optimistic. While there might be a slowdown in economic growth, the economy will remain in positive territory. The key approach in such an environment is a bottom-up stock-picking approach.”
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