STORS have withdrawn £1bn from UK equity funds in the run-up to next week’s General Election, according to a new report from Hargreaves Lansdown.
Overall net fund sales to retail investors were down by more than half in March compared to the same time last year, according to the fund manager’s report.
Laith Khalaf, a senior analyst at Hargreaves Lansdown, said private investors are staging a “buyer’s strike” ahead of 7 May.
“This is pretty par for the course when it comes to the uncertainty generated by such a big political event, and the FTSE reaching a record high won’t have helped matters,” he said.
But Khalaf also said the General Election would have short-term, rather than long-term implications for UK companies’ profits.
“When you look back at events that shaped stock market returns in the last 15 years, you think of the dot com crash, the financial crisis, and ultra-loose monetary policy,” he said. “The elections of 2005 and 2010 come pretty far down the list.”