The popularity of Absolute Return investments has continued to grow, becoming the third highest selling sector for August, figures from a financial planning platform show.
Cofunds, which offers access to multiple funds through a consolidate portfolio, said the top selling fund for August was the Standard Life Investments Global Absolute Return Strategy, with Absolute Return funds accounting for seven per cent of net sales.
Asbolute Return funds use different types of market tools, such as taking futures positions, as well as stock investments to try and deliver returns regardless of overall market performance.
The biggest share of sales remains Cautious Managed funds, with 30 per cent of net sales, while Strategic Bonds were the second highest sector with 10 per cent of sales.
Strategic Bond funds invest in a more diverse range of bonds compared to Corporate Bond funds.
Michelle Woodburn, manager of fund group relations at Cofunds, said: “Absolute Return has seen a gradual organic increase in advisers’ favour with steady growth indicating that this is not a bubble of popularity.”
Woodburn said Cautious Managed remained the top seller in part because the sector is dominated by multi-manager funds which are seen as an outsourcing solution for asset allocation.
A review by the Investment Management Association, undertaken earlier this year, showed there are now 48 different funds in the Absolute Return sector, with a total of £13.6billion under management.
Ten of those are offshore funds with £1.2billion of funds under management.
© Fair Investment Company Ltd