The most well-liked stocks, investment trusts, and ISA funds

As the end of the tax year draws closer in April, many investors will be trying to maximize their annual ISA allowance

By April, when the tax year is coming to an end, many investors will want to maximize their annual ISA allowance.

Even though interest rates have decreased, geopolitical issues like Trump tariffs, the conflict in Ukraine, and Middle East tensions raise the possibility that inflation will remain high or even rise once more.

If you have extra money to spend on ISAs and SIPPs, that can make investment decisions difficult. However, the majority of investors are aware that market volatility is common and that long-term investments can yield returns.

With passive index funds preferred over active ones, investors are going global and favoring income, cash alternatives, and exposure to the US market, according to fund supermarket AJ Bell.

This may not come as a surprise given that many active managers have found it difficult to beat the robust US market as the SandP 500 has risen due to the Magnificent 7.

Where are investors investing? We examine the most popular funds, investment trusts, and shares that AJ Bell ISA clients have invested in thus far in 2025.

Top-ranked ISA funds.

AJ Bell investors' list of the most popular ISA investments so far this year did not include a single actively managed stock and share portfolio.

Instead, users have chosen exchange-traded vehicles or inexpensive tracker funds.

It comes after AJ Bell's recent research revealed that, over the previous ten years, only 31% of actively managed funds have outperformed a passive alternative.

According to AJ Bell investment analyst Dan Coatsworth, "UK investors are becoming less confident in fund managers' capacity to regularly beat the market. By avoiding active funds, investors are opting to just track the market, which is less expensive. The reason is obvious.

Along with a string of poor results from so-called star fund managers Terry Smith and Nick Train over a number of years, the 2019 collapse of Woodford Asset Management, which had a detrimental impact on hundreds of thousands of people, has further made investors cautious about active management. Even though some talented managers continue to produce exceptional results, it is very difficult for them to be successful year after year.

"Royal London Short-Term Money Markets was the only actively managed fund in the top 10 outside of the equity space. Money markets funds have become extremely popular as investors have been searching for cash alternatives that can be held in an investment ISA due to declining interest rates on cash accounts.

Bell, AJ. Data: January 1February 28, 2025. based on net flows.