Following March’s “flight to safety”, the assurance from governments that they were prepared to do “whatever it takes” to avoid a serious recession buoyed markets and saw investors return to active management.
Active management edges out passive performance in Q1
With both active and sustainable credentials, Royal London Asset Management (RLAM) and Liontrust took the top spots from last quarter’s passive winners, with £1.3bn and £964m of net retail sales placing the pair in first and third respectively, while Baillie Gifford broke both its gross and net retail sales records, putting the firm in second place across net sales with £1.1bn.
RLAM enjoyed a gross sales boost from its fixed income products but owed its high ranking to its sustainable products, which provided 80% of its net flows.
Baillie Gifford’s “strong performance” across its actively managed funds have made the house a “top pick for investors looking for growth”, with Baillie Gifford American ranking as its best-selling fund, while Baillie Gifford Positive Change also contributed strongly to its Q2 sales.
Helen Pridham, editor of the Pridham Report, said: “Royal London Asset Management has been promoting sustainable funds for some years but it has pointed out that Covid-19 has been the catalyst that has encourage investors and advisers to take more notice of these funds.
“Liontrust, which reported record gross and net sales in the quarter, also benefited from this trend, with over half of its net flows coming from sales of its Sustainable Future funds.”
BlackRock, which took the net top spot in Q1, fell to fifth place (£823m) and Fidelity remained mid-table with £872m, although it climbed two spots to fourth place during Q2.
In gross retail sales, however, passive firms still topped the charts as first-placed BlackRock saw flows of £5.9bn, silver medal went to Fidelity with £3.5bn and Legal and General IM wrapped up the podium spots in third with £3.1bn.
Fidelity, with its foot in both active and passive camps, enjoyed the best net retail sales of passive houses, thanks to its best sellers, including its Global Dividend, Emerging Markets, Asia Pacific Opportunities and Global Technology funds.
RLAM strengthens global credit team
Pridham added: “Markets will remain volatile for the rest of the year so fund companies will need the right products and performance to succeed. The focus on ESG funds is likely to grow.”
