Best-selling funds, Investment Trusts and ETFs of April 2025

After a precarious few weeks following ‘Liberation Day’, global stock markets have bounced back. There is growing expectation that Donald Trump will not follow through on the worst of his tariff threats, and the global economy may yet be spared a recession.

Trump has now negotiated deals with China and the UK, and rolled back the worst of the tariffs for both countries. He has also exempted key industries. Apple, for example, could breathe a sigh of relief as a carve out for small electronics was announced. The company, which has a large manufacturing base in China, had estimated that tariffs could cost it as much as $900m (£677.5m) in the current quarter.[1]

This has, unsurprisingly, changed the mood in markets. After a period when defensive, predictable companies such as utilities, healthcare and consumer staples have done well, the technology sector showed its bouncebackability. The CNBC Magnificent Seven index has risen 12.2% over the past month.[2]

Nevertheless, Europe has continued to outpace the US, with a particularly strong showing from its defence sector. The sector has been buoyed by significant increases in spending from major European powers, particularly Germany, and from the EU itself. Over April, the MSCI Europe rose 4.5% against 0.9% for the MSCI World.

Bond markets have also been more stable after wobbles in March and April. After the US 10-year bond yield spiked in early April, prompting Trump to retreat on his tariffs, it has been relatively stable at between 4.25% and 4.5%.[3] Nevertheless, the Federal Reserve has resisted pressure from the US administration to cut rates, saying that it needs more clarity over the potential impact of tariffs on inflation and jobs.

It remains an uncertain moment for investors. The final shape of the tariff regime is still unclear, even if markets appear to be over the worst. There is also the danger that Donald Trump may have more up his sleeve.

Investors were feeling more adventurous as markets recovered over the month. Across all four platforms, the Fidelity Index World fund was, once again, the top-selling individual fund. The fund tracks the MSCI World index, which currently has over 70% invested in the US, and over 20% invested in the ‘Magnificent Seven’ mega-cap technology companies.[4] This may help explain the resilience of the US market.

The Legal & General Global Technology Index fund continued to be popular across three out of the four platforms. On Hargreaves Lansdown, the UBS S&P 500 index was the top-seller, showing investors haven’t lost their appetite for the US stock market.

Elsewhere, there were other signs of investor optimism. On the AJ Bell platform, its home-grown Adventurous and Moderately Adventurous funds were popular. That said, this also suggested investors were more inclined to hand fund selection to an expert than pick individual funds themselves. The popularity of the Vanguard LifeStrategy 80% Equity fund across all four platforms also suggested investors were looking for a balanced approach.

Some investor nervousness remained. On the ii platform, the Royal London Short Term Money Market fund was the top-seller, and the Fidelity Cash and Legal & General Cash Trust funds were top sellers on the Fidelity platform.

Investment Trust investors remained largely immune to the volatility in global stock markets over the month. Higher growth, technology-focused Scottish Mortgage was a top seller across all four platforms. However, more conservative trusts also proved popular with advisers - with JP Morgan Global Growth & Income, City of London, and F&C also appearing across all four best buy lists.

Investors also showed some appetite for Asia-focused funds. These have been out of favour, but China has started to show signs of economic recovery and a turnaround in its under-pressure property sector. The China Special Situations fund was a popular choice on the Fidelity platform, while Henderson Far East Income featured on the Interactive Investor platform. The JP Morgan Emerging Markets fund featured on the AJ Bell platform.

The technology funds – from Polar and Allianz Global Investors - were also popular, in spite of the volatility in the sector. Investors may have used lower valuations as a chance to buy in at lower cost (also known as "buying the dip").

As with last month, there were also signs that investors were leaning into alternatives, possibly in a drive for greater portfolio diversification at a time of unsettled markets. Greencoat UK Wind and RIT Capital Partners featured on the AJ Bell platform, while International Public Partnerships and GCP Infrastructure investments were popular among Fidelity’s investors. Greencoat UK Wind also appeared on the Hargreaves platform, alongside Renewables Infrastructure and 3i. 3i and Greencoat UK Wind were also on the best-seller list from ii.

ETFs offer flexible, theme-focused investment opportunities that can be tailored to specific sectors or strategies. As a result, investors will often use them to take advantage of shorter-term trends in markets. They can therefore be a good indicator of what markets are thinking.

This month, the ETF data showed real polarisation. On the one hand, S&P 500-focused ETFs were popular as investors looked to buy the dip. Investors were buying into both Dollar-denominated and sterling-based S&P 500 ETFs, but Dollar ETFs had the edge as investors sought to take advantage of the weakened US currency.

At the opposite end of the scale was the popularity of physical gold ETFs, which were a feature on all four platforms. Gold has been a significant beneficiary of the volatility in stock markets since the start of the year, but its strength has started to ebb as some stability has returned to financial markets. The iShares Physical Gold proved most popular.

The UK proved a surprisingly popular choice, with the iShares Core FTSE 100 ETF featuring on all four platforms. There have been better signs coming out of the UK economy and the market is cheap, which may have drawn in investors disaffected with the US. A UK/US trade deal may see this popularity continue.

Last month’s enthusiasm for defence funds was not in evidence this month, with investors returning to the mainstay technology-focused ETFs.