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Money pours out of Liontrust as investors quit UK shares

London shares are badly out of fashion
London shares are badly out of fashion

The strife in UK fund management continued today when Liontrust said it had lost another £1.2 billion in funds in the last three months.

Chief executive John Ions said: “This follows a period in which many of our core investment strategies, notably quality growth, small/mid-caps and UK equities, have been out of favour, impacting both performance and flows.”

Liontrust now manages £27.6 billion.

Yesterday, Ashmore, the emerging markets fund manager, said investors had withdrawn $2 billion in the first three months in the year as they look to cut risk.

These figures follow ones from March that show money is flowing out of London equities at the fastest pace ever. According to the Investment Association, UK savers took £14 billion out of UK shares in 2023, the 8th consecutive year of outflows.

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Liontrust added: “We believe our focus on active management can deliver both for clients and the Company. Liontrust has excellent investment teams with proven processes and strong long-term performance. As market sentiment changes, Liontrust is well positioned to benefit.”

Yesterday the FTSE 100 had its worst day for nine months, falling nearly 2% on the assumption that interest rates will stay higher for longer.

There are growing calls for the government to do something to improve the attractiveness of UK shares to investors.

Chancellor Jeremy Hunt recently launched a UK ISA to allow tax free investment in British shares. Observers say this is not enough to make a difference.