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Rachel Springall

Finance Expert & Press Officer
Published: 27/02/2023
ISA document

Most primary fund sectors returned a loss over the past 12 months.

The average stocks & shares ISA fund experienced a loss of 3.27% between February 2022 and February 2023, according to Moneyfacts research in collaboration with Lipper IM.

This should not be much of a shock considering the significant volatility felt across the markets over the past year, but it does emphasise the importance of keeping track of investments and ongoing fund performance.

In comparison, the Moneyfacts average cash ISA rate returned 1.71% in the same period thanks to increased competition in the sector and consecutive Bank of England (BoE) base rate rises.

In February last year, the base rate stood at 0.50% and has since followed eight further consecutive increases. Today, it stands at 4%.

In response, the average easy access cash ISA stood at 0.26% last February and has since increased to 1.85%.

Market volatility

Most primary fund sectors returned a loss over the past 12 months. The worst-performing stocks and shares ISA fund sector came from UK Index Linked Gilts, which lost more than 32% on average.

However, some sectors did experience growth, as Commodities and Natural Resources was the best-performing sector. It grew by over 24% on average for its investors.

Still, those considering stocks and shares must keep in mind that past performance is never guaranteed to be reflected in future returns, so it’s vital investors are comfortable with their level of risk.

Whether someone is savvy with investing in funds or just a beginner, it is always wise to seek advice and regularly review any risk profile.

Remember your PSA

Could you be hit with an unexpected tax bill? Learn more about how your Personal Savings Allowance could affect you this year.

Cash ISAs are traditionally a more popular choice among consumers, but some investors may well be reconsidering their attitude to risk in hopes of growing their pot over the longer-term.

Indeed, HMRC data showed a rise in the number subscribed to stocks and shares ISAs between 2020 and 2021, but Cash ISAs held the majority share.

Over more recent years, there have even been ISAs created to encourage consumers to save for a home or retirement, such as with a Lifetime ISA. The right ISA for any saver will come down to their individual needs and those considering stocks and shares must keep in mind that past performance is never guaranteed to be reflected in future returns, so it’s vital investors are comfortable with their level of risk.

Disclaimer

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