Record number of firms buying investment companies on adviser platforms

Purchases of £968m made in first nine months of 2021.

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More advisory firms and wealth managers are buying investment companies on adviser platforms than ever before, according to data released today by the Association of Investment Companies (AIC).

According to the data compiled by Matrix Financial Clarity, the number of firms that bought investment companies via adviser platforms in the third quarter of 2021 was 2,157, compared to 1,983 in the previous quarter. The previous record was 2,014 firms in the third quarter of 2016, when demand for investment companies spiked after the gating of several open-ended property funds following the EU referendum.

Purchases of investment companies on adviser platforms

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Source: Matrix Financial Clarity. Blue line shows average quarterly number of firms purchasing investment companies (average of 4 quarters for each calendar year). * First nine months of 2021 only.

Purchases of investment companies in the first nine months of 2021 totalled £968 million, compared to £754 million in the same period of 2020, an increase of 28%. Total purchases for 2020 were £1.05 billion.

In Q3 alone, purchases of investment companies amounted to £279 million, 18% higher than in the same quarter of 2020 (£236 million).

The most-purchased investment company sectors in Q3 were Global (17% of purchases), Flexible Investment (11%), Infrastructure (7%), UK Equity Income (6%) and Asia Pacific (4%). This puts Asia Pacific in fifth place for purchases, its best ranking for the past three years.

Transact continues to be the dominant adviser platform for investment company purchases, accounting for 42% of all purchases in Q3.

Nick Britton, Head of Intermediary Communications at the Association of Investment Companies (AIC), said: “Since the Retail Distribution Review we’ve seen an upward trend in the number of firms buying investment companies on adviser platforms – from around 600 in 2012 to over 2,000 in these latest figures. The rising popularity of investment companies with advisers and wealth managers shows growing appreciation of their structural advantages, from the ability to deliver consistent income to their flexibility in accessing property, infrastructure and other alternative assets.

“We continue to offer free training to hundreds of advisers every year and look forward to seeing the benefits of investment companies being even more widely recognised.”



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Notes to editors

  1. The Association of Investment Companies (AIC) was founded in 1932 to represent the interests of the investment trust industry – the oldest form of collective investment.  Today, the AIC represents a broad range of closed-ended investment companies, incorporating investment trusts and other closed-ended investment companies and VCTs. The AIC’s members believe that the industry is best served if it is united and speaks with one voice. The AIC’s mission statement is to help members add value for shareholders over the longer term. The AIC has 360 members and the industry has total assets of approximately £278 billion.
  2. Disclaimer: The information contained in this press release does not constitute investment advice or personal recommendation and it is not an invitation or inducement to engage in investment activity. You should seek independent financial and, if appropriate, legal advice as to the suitability of any investment decision. Past performance is not a guide to future performance. The value of investment company shares, and the income from them, can fall as well as rise. You may not get back the full amount invested and, in some cases, nothing at all.
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