Intermediaries accounted for more than 80% of gross retail business in the investment sector, as total funds under management rose to £411bn in January, while net ISA sales fell by more than 70%.
The latest figures from the Investment Management Association (IMA) reveal total investment funds under management rose slightly in January from just over £410bn in December, while the data shows a 15% rise in funds under management compared to 12 months ago.
However, the figures highlight a marginal fall in Isa funds under management, which slipped to £51bn, although the IMA points out this is still 11% higher than the same time last year.
Despite the government’s decision in December to make the Isa regime permanent, IMA figures show net Isa sales have fallen 71% between December and January to £31m, which is 62% lower than January 2006.
The IMA says total net sales were £732m in January overall, with bonds accounting for inflows of £345m, while within the £893m net retail sales, £576m was invested in equities, of which £392m was placed in property funds, and £116m ended up in balanced funds.
The IMA figures also reveal intermediaries were the most popular distribution channel in January, as they accounted for 83% of gross retail business, while fund supermarkets were the biggest distributor of Isas with gross sales of £234m, closely followed by sales force or tied agents who completed £169m of sales.
In addition, the IMA says the UK All-Companies sector was favoured by most advisers, resulting in 17% of the gross retail business in this channel, although overall it says the specialist sector remained the most popular net retail sector for the thirteenth consecutive month with inflows of £351m.
Richard Saunders, chief executive of the IMA, says: "2007 opened with a relatively quiet month by recent standards, but net inflows from retail investors were still very healthy at just under £900m. Once again Isa distribution continued to be dominated by fund supermarkets and it will be interesting to see how this develops during the 2007 Isa season."
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