Sales of investment funds rose for the fourth month in a row during May as consumers hunted for higher returns on their cash.
New investments into UK-based unit trusts and OEICs (open-ended investment companies) made by individuals reached £2.84bn during the month, according to the Investment Management Association (IMA).
The figure was more than a third higher than duri
ng April and was the strongest month for sales outside of the ISA season since the group's records began in 1960.
It is thought the increase is being driven by a rise in confidence among investors that now is a good time to buy into the stock market.
Record low interest rates are also causing people to look for alternative homes for their money as returns on savings accounts have fallen to zero in some cases.
Around £1.3bn of the total money was invested in bonds, which are less volatile than shares and can be used to provide a regular income, making them a good alternative to savings accounts for investors who are prepared to take a bit more risk.
Just under £1bn was also put into equity funds, the highest level for 13 months, suggesting investors are ready to return to the stock market. Investments into tax-free ISAs fell to £312.4m during the month, down from £672.4m in April, when inflows were boosted by the turn of the tax year.
