Last year, despite the UK stock market achieving its strongest performance in 16 years, mutual funds focused on UK equities saw significant outflows. According to Jin10, data from the Investment Association reveals that retail investors withdrew a net £11.1 billion from UK stock funds in 2025, marking the tenth consecutive year of outflows. Over the past decade, the total withdrawal from UK equity funds has surged to £71 billion.
This trend occurs as UK Chancellor Reeves strives to boost the UK stock market, declaring it the beginning of a 'new golden era for the City of London.' Les Halaf, Head of Investment Analysis at fund platform AJBell, commented, 'UK stock funds have performed poorly over the past decade. Part of the reason is the allure of Silicon Valley, which has attracted capital across the Atlantic. Additionally, self-directed investors prefer investing in domestic stocks, reducing their need for fund managers.'