Early tax year ISA and SIPP investors back global funds and US exposure

Early ISA and SIPP investors are backing global funds and US exposure at the start of the new tax year, according to analysis from Hargreaves Lansdown.

The investment platform said that index funds have continued to dominate, with a blend of growth, income and technology exposure.

Hargreaves Lansdown also suggested that investment trusts and ETFs on its platform are showing a balance between long-term growth themes and defensive assets, such as infrastructure and gold.

Lead investment analyst at Hargreaves Lansdown, Kate Marshall, commented: “Early-bird investors on Hargreaves Lansdown’s platform wasted no time putting new tax-year allowances to work, with global equity funds and US-focused investments dominating flows across both ISAs and SIPPs.

“Data covering 6 to 17 April shows a consistent preference for low-cost index funds, alongside selective allocations to active strategies and higher-growth sectors such as technology.”

Marshall said that global tracker funds were the “clear favourites” among both ISA and SIPP investors in the opening weeks of the tax year, with Fidelity Index World, Vanguard FTSE Global All Cap Index and Legal & General International Index Trust featuring prominently, while US equity exposure was also a “key theme”.

“Funds such as UBS S&P 500 Index and Legal & General US Index were among the most bought across both account types, suggesting investors are maintaining confidence in the world’s largest equity market despite ongoing uncertainty,” added Marshall.

In terms of investment trusts and ETFs, the Hargreaves Lansdown analysis revealed that Scottish Mortgage Investment Trust topped the list for both ISA and SIPP investors, signalling continued interest in long-term growth opportunities despite periods of volatility.

“Technology exposure was a theme, with Polar Capital Technology Trust featuring,” Marshall said. “Infrastructure and renewable energy exposure also proved popular, with Greencoat UK Wind attracting flows.

“ETF flows reinforce the same core themes, with global and US equity trackers dominating purchases.”

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