For stock market results reasons, we published headline figures only for the PLATORM INDUSTRY in February 2018. Now that all platforms have released their results, we can reveal the leading platforms for 2017.
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Momentum continued to build in the platform industry during the second quarter as pension freedom and ISA business drove investment. Market growth was neutral in the second quarter, but assets under administration rose by £19bn (4%) to £539bn, while gross and net sales again climbed to new highs of £34bn and £14.4bn respectively.
It was a cracking start to the year for the platforms industry with several new highs. Assets under administration rose by £31bn (6%) to £520bn, smashing through the £500bn ceiling, while gross and net sales set new records of £29bn and £13.3bn respectively. This was in marked contrast to the start of 2016 when economic factors and Brexit fears led investors to stay away from investments.
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In a year overshadowed by political uncertainty, it is no surprise that investors sat on the side-lines waiting for the storm clouds to clear. But after three quarters of sluggish activity, sentiment improved and net sales rose to £10.5bn in the fourth quarter, the highest since Q415. However, it was not enough to correct the balance — annual net sales of £38bn were down 16% on the £45bn in 2015 and few platforms were able to improve on their 2015 figures.
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Following the EU referendum, the FTSE 100 and the FTSE All-Share indices rocketed by 6% and 7% in the third quarter of the year, on top of the growth already experienced in late June. Against this backdrop, according to the Fundscape Platform Report, platform assets rose 9% from £432bn to £469bn by end September 2016. Since the start of the year, UK platform industry assets have increased by £67bn, an increase of 17%.
The first half of 2016 was challenging for fund groups and platforms alike. The stock market correction eased up as the second quarter began — in time for last-minute ISA activity — but Brexit scared off many investors who chose to hold off until after the referendum. Only pension flows broadly maintained their momentum.
According to the Fundscape Platform Report, as a result of investors switching and taking shelter in cash and safe products, gross flows for the quarter swelled to £24bn (£22bn in Q116), but net sales fell to £9.57bn (£9.6bn in Q116), the lowest total since Q3 2014 (£8.8bn). Bella Caridade-Ferreira, CEO of Fundscape, said “Investors lost their nerve in the final weeks before the Brexit vote and cashed out. Platforms without decent cash facilities would have felt the pain more keenly.”