The first six months of 2025 has been a “game of two halves” when it came to investor sentiment, according to the Investment Association.
New data shows a tough first quarter, with outflows of £1.9bn, was followed by a more positive second quarter which saw inflows of £4.8bn.
UK retail investors added £438mn to funds in June, bringing total inflows for the first half of 2025 to £2.9bn.
The IA said: “A turbulent geopolitical backdrop polarised investor behaviour, with some taking advantage of market volatility through April and ‘buying the dip’, boosting sales to North American equities.
“Others preferred caution and portfolio diversification, opting for European equities or funds that are managed to volatility targets.”
The IA added: “Despite significant global market events, the monthly data suggests that investors have remained resilient — gradually re-entering markets and adjusting their portfolio to suit risk appetite.”
In June 2025, there was bad news in UK equities with outflows of £964mn, the worst recorded in three months and an increase on the softer outflows of £356mn the previous month.
However, overall equities saw £1bn in outflows in June, bringing total outflows to £2.7bn for the first half of 2025.
The IA called this a “sharp reversal” of the £366mn inflows seen over the same period in 2024, as investors continued to shift more diversified mixed asset funds.
Miranda Seath, director of market insight and fund sectors at the Investment Association, added: “After a rocky start to 2025, we’re starting to see the mood shifting among investors.
“Despite Q1 2025 recording outflows of £1.9bn, June continued the trend of monthly inflows and markets have remained resilient in the face of trade wars and uncertain tariff policy.”
tara.o’connor@ft.com
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