UK assets were by far the hardest hit by the stampede. More than one third (£988m) of the total outflows was pulled from funds focused on UK equities, making October the fourth worst month on record for the sector.
The sell down is likely to prompt more fears about the health of the London market. Analysts have complained about a “doom loop” for the stock exchange, with the value of UK companies declining due to a surge of investors bailing out of British stocks.
Another quarter of outflows came from funds which pay a regular dividend to savers, which are known as income funds and heavily skewed towards the UK stock market.
October was also the first month in more than a year in which UK investors withdrew cash from US equity funds, while it was the first month in more than two years that global equity funds recorded outflows.
This suggests that investors were looking to book profits following strong growth in US and global markets over the last year.
Meanwhile, fixed income funds had their best month since June 2023, with investors adding £631m.
This reflected a surge in bond yields in recent weeks as investors evaluate deep interest rate cuts by the Federal Reserve and fear an expected rise in government borrowing and spending in the UK.
Money market funds, which are traditionally seen as a safe-haven asset class, also saw higher inflows, rising to £402m in October.
Mr Glyn added: “The suggestion that interest rates may stay higher for longer in the wake of the Budget made interest-earning assets like bonds and cash funds more attractive to investors.”