LONDON — UK insurance companies, pension funds, and trusts pulled a collective £15 billion ($18.7 billion) worth of investments between July and September, new figures show.
Data from the Office for National Statistics (ONS) released on Thursday shows a net disinvestment in the third quarter, meaning Britain’s biggest investors pulled more money out of the market than they invested.
This is highly unusual.
A quarterly disinvestment has only occurred 5 times since 1987, showing just how unusual the sell-off is, and the ONS says: “In terms of context, the 5-year quarterly average for this series is net investment of £6 billion.”
The figures are the first full investment numbers since the Brexit vote and the effect seems striking. However, the ONS cautions that “only a very limited number of our survey respondents mentioned this [the EU referendum] as a factor in their returns.”
The biggest sell-off came in the stock markets, with British investors selling off £11 billion worth of overseas shares and £8 billion of UK-listed shares.
But the ONS says: “In Quarter 3 2016, net disinvestment was reported in overseas securities, UK corporate securities, other assets and UK government sterling securities.” So pretty much across the board.
The ONS says the investment activities of the insurance, pension, and trust sectors are important because “these institutions control £4 trillion of assets and engage in considerable volumes of investment activity to fund their operations.
“An understanding of their investments and assets is important in order to monitor the stability of the financial sector and is used in the compilation of the UK National Accounts.”