Asset class view
- Net flows were negative for the third consecutive month, albeit more subdued (-£357m; -£313m ex-MMFs)
- Bond funds fared best (+£2.12bn), and equities worst (-£1.78bn)
Active v passive
- Despite equities’ negative flows, active strategies attracted £842m—a reversal of the long-term active-to-passive rotation
- Passive bonds funds were the most successful passive asset class (+£1.12bn: +£701m MF; +£418m ETF)
Classifications
- Mixed Asset GBP Aggressive saw the highest inflows for the month (+£1.23bn)
- Equity US rebounded from last month’s heavy outflows, attracting £900m
Sustainable fund flows
- Net sustainable fund flows were £267m, as conventional funds saw net outflows (-£624m)
- Sustainable equities fared best (+£433m), despite significant conventional outflows for the asset class (-£2.21bn)
Asset manager view
- Legal & General was the most successful over August, netting £798m, mainly to MMF (+£318m), equity (+£283m), and bond funds (+£239m)
Flows by Asset Class
Three-Year Flows
Chart 1: Asset Class Flows, 36 Months, to August 2025 (£bn)
Source: LSEG Lipper
Despite sustained uncertainty over trade policy and inflation, risk assets continue to perform over August.
The heavy equity redemptions we saw in July abated somewhat, though the asset class remained in negative territory. Year-to-date, UK investors have redeemed £30.44bn from mutual funds and ETFs (-£41.65bn, ex MMFs). Over the period, MMFs are in positive territory (+£11.2bn), as are alternative funds (+£695m) and commodities (+£650m).
However, despite generally positive market performance, equity funds have shed £32.3bn, followed by bonds (-£7.67bn), mixed assets (-£2.56bn), and real estate funds (-£658m).
Active versus Passive
Chart 2: Asset Class Flows, Active and Passive, August 2025 (£bn)
Source: LSEG Lipper
Net flows were negative for the third consecutive month, albeit at a much more subdued level (-£357m; -£313m ex-MMFs). However, actively managed funds benefited from inflows of £1.1bn while passives shed £1.43bn.
Bond funds fared best (+£2.12bn: +£1bn active/+£1.12bn passive), followed by alternatives (+£515m), as yield curves continued to steepen, with the short end pulled down by generally declining base rates, while further out on the curve, yields are being pushed up by concerns over fiscal stress in many markets.
Alternatives netted £513m. All other asset classes were in the red, with mixed assets seeing outflows of £1.16bn, and equities shedding £1.78bn, albeit with inflows to active strategies of £842m—something of a reversal of the long-term rotation from active to passive.
ETFs and Passive Mutual Funds
Chart 3: Passive Asset Class Flows, Mutual Funds v ETFs, August 2025 (£bn)
Source: LSEG Lipper
Of the £1.43bn of passive redemptions in August, mutual funds saw outflows of £2.02bn, while ETFs netted £591m—similar to their July intake.
As was the case last month, passive bonds funds were the most successful (+£1.12bn: +£701m MF; +£418m ETF), followed by mixed assets (+£71m, all MF).
Passive equities shed £2.62bn (-£2.79 MF/+£167m ETF).
Flows by Classification
Largest Inflows
Chart 4: Largest Positive Flows by LSEG Lipper Global Classification, August 2025 (£bn)
Source: LSEG Lipper
Mixed Asset GBP Aggressive saw the highest inflows for the month (+£1.23bn), almost entirely to active funds.
Source: LSEG Lipper
Mixed Asset GBP Balanced (+£938m), with one share class, BlackRock Intermediate Investment Fund X1 Acc GBP, accounting for almost double this (+£1.55bn). July’s flows were almost as concentrated for this classification.
Equity US rebounded from last month’s heavy outflows, attracting £900m (+£311m active/+£598m passive).
Source: LSEG Lipper
Equity Global also recovered from July’s heavy redemptions, attracting £715m, with a large passive-to-active rotation (+£2.39bn active/-£1.67bn passive). The top-five money takers accounted for £3.75bn of inflows—and all were sustainability themed.
Despite bonds being the most successful asset class for the month, bond classifications occupy the seventh to tenth positions on the table. The top money takers in Bond Global USD are passive vehicles, and predominantly broad global bond indices. Short European and EM inflation linked bonds dominate the top 15 performers in August in euro and sterling terms, according to FTSE Russell analysis. All the bottom 15 performers were longs.
Largest Outflows
Chart 5: Largest Outflows by LSEG Lipper Global Classification, August 2025 (£bn)
Source: LSEG Lipper
Target Maturity Other suffered the heaviest redemptions over the month (-£3.66bn), with outflows concentrated on a handful of share classes from a single provider.
The FTSE 100 and 250 underperformed global equities, reversing the previous month, with the latter falling. Equity UK shed £1.97bn (-£280m active/-£1.69bn passive). Equity UK Small & Mid Cap (-£343m) and Equity UK Income (-£324m) were also in negative territory.
Japan’s equity markets extended their rally, with the TOPIX and Nikkei 225 rising more than 4%, supported by positive Q2 GDP growth, moderate inflation, and strong corporate earnings. Nevertheless, despite a strong month for APAC ex Japan and, particularly, Japanese equities, both Equity Asia Pacific ex Japan and Equity Japan shed assets (-£514m and -£324m, respectively).
Similarly, emerging markets posted positive returns, aided by a softer US dollar. Latin American markets performed well. Brazil shrugged off tariff concerns, buoyed by currency strength and improving inflation. South Africa’s FTSE/JSE All Share Index hit a record high, driven by an 11.5% surge in the resources sector and strong gains in financials. Nevertheless, Equity Emerging Mkts Global saw outflows of £193m (+£249m active/-£442m passive).
Bond Global Corporates LC (-£151m), Bond Global GBP (-£138m), and Bond GBP (-£132m) saw the largest fixed income outflows.
Sustainable Fund Flows
Chart 6: Sustainable Asset Class Flows, August 2025 (£bn)
Source: LSEG Lipper
Net sustainable fund flows in August were £267m, as conventional funds saw net outflows (-£624m).
Sustainable equities fared best (+£433m), despite significant conventional outflows for the asset class (-£2.21bn). This reverses the previous month’s heavy outflows for sustainable equity, although smaller than their conventional peers (-£8.95bn sustainable/-£26.41bn conventional). As can be seen from the table below, these are entirely dominated by BlackRock vehicles, with typical sustainable picks—Equity US and Global—back in vogue.
Source: LSEG Lipper
The only other sustainable asset class to be in the black was real estate (+£7m), netted by the AI Climate Transition RealAssets LTAF Ins Pen Acc1.
Although sustainable bond funds suffered net redemptions (-£3m versus +£2.12bn for conventional bond funds), some investment grade corporate funds (USD, GBP and short-dated—see below) attracted cash.
Source: LSEG Lipper
Mixed assets (-£156m, versus -£1bn conventional) and MMFs (-£11m, versus -£33m conventional) saw redemptions.
The Sustainable Fund Flows section has a narrower and stricter focus than those which indicate some form of ESG strategy in their fund documentation—to a smaller group of sustainable funds, defined as all SFDR article 9 funds plus all Lipper Responsible Investment Attribute funds reduced to those containing indicative sustainable keywords in the fund name.
Flows by Promoter
Chart 7: Largest Positive Flows by Promoter, August 2025 (£bn)
Source: LSEG Lipper
The top 10 fund promoters attracted 58.9% of the total inflows for the month.
Legal & General was the most successful over August, netting £798m, mainly to MMF (+£318m), equity (+£283m), and bond funds (+£239m).
Source: LSEG Lipper
JPMorgan followed, with inflows of £738m, with £894m to MMFs.
Source: LSEG Lipper
