Ethical funds record impressive performance

Strong inflows in ethical funds have been noted in latest industry statistics.

According to new first quarter data from the Investment Management Association (IMA), net sales of £378 million were noted among UK fund providers, including private wealth management services, over the three-month period.

Ethical funds accounted for £45 million of this total - a significant rise over January March 2008’s inflow of £28 million.

Meanwhile, Cautious Managed funds received £155 million of inflows.

Tracker funds, which gain and lose value in line with stock markets, lost ground - suffering a net outflow of almost £32 million.

This could be because of volatile market conditions over the first quarter, with the FTSE 100 dropping from 4,440 points at the beginning of the year to a low of 3,510 in early March.

Jane Lowe, director of markets at the IMA, commented: ’Ethical and tracker funds are showing slightly atypical trends, reflecting their niche position in the funds market.’

Penny Shepherd, chief executive at the UK sustainable investment and finance association, said: ’These latest numbers add even more weight to the argument that green and ethical investors are ’sticky’.

’They are typically long-term investors who look beyond short-term market fluctuations and want to benefit from sustainable wealth creation. Retail inflows into ethical funds have now exceeded outflows for each of the fourteen months since February 2008.’ADNFCR-2318-ID-19159941-ADNFCR