UK institutional investors shifted focus to fixed income in August while their retail counterparts turned to UK equities over any other sector for the first time in three-and-a-half years, defying expectations of a move to less risky asset classes.

UK institutions last month poured £295m (€423m) into domestic gilt funds, pulling £212m out of UK equities and £442m out of North American equities, according to research from the Investment Management Association.