Calastone: 2025 marks worst year in over a decade for equity fund flows

After an unprecedented seventh consecutive month of net outflows in December, 2025 is officially the worst ever year for equity fund flows on Calastone’s record.

The firm’s latest Fund Flow Index saw a further £188m withdrawn from equity funds in the final month of the year, bringing total net outflows for 2025 to £6.71bn.

Calastone reported this was comfortably the worst year in its 11-year data history and more than double the previous record of £3.34bn set in 2016, the year of the Brexit referendum.

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The net £10.57bn withdrawn since June 2025 is the largest and most prolonged selling spree on record.

However, the December outflow was the smallest since June, with every equity sector either reducing net outflows or increasing inflows.

The largest improvements on November were seen in North American funds, where an £812m outflow turned into a £107m inflow in December. Global funds recovered from a £747m outflow to a £174m inflow.

Meanwhile, UK-focused fund outflows narrowed from £847m to £541m. Despite the FTSE 100 reaching all-time highs in 2025, the £9.55bn outflows from UK funds came at a similar level to 2024’s £9.56bn and marked the tenth consecutive year of withdrawals.

Elsewhere, multi-asset funds enjoyed a strong year, attracting a net £11.76bn. Money market funds had a record year, bringing in a net £5.84bn.

Fixed income funds saw inflows rise to £1.51bn, though this was less than half of the asset class’s decade average.

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Edward Glyn, head of global markets at Calastone, said: “The sudden, dramatic slowdown in outflows between November and December is a clear indicator that months of pre-Budget speculation contributed to the record outflows from equity funds between June and Budget Day.

“But this isn’t the whole story. Record money market inflows point to investors favouring the safety of cash, suggesting they perceive equity valuations to be teetering after a dramatic 2025 bull run. Solid inflows to mixed asset funds and fixed income support the notion that risk-off is the name of the game at present.”