Resource stocks have risen in value by £162bn over the last 18 months, and now account for over one third of the FTSE 100. So Tom Ewing, manager of the Fidelity UK Growth fund, argues that commodities are more representative of the UK equity market than banks and financials.

In April and May, prices for metal, energy and agricultural stocks rose by 19 per cent, bolstered by demand from China and India, and the decision of investment funds to move away from riskier asset classes such as property. And energy prices are still rising, with oil hitting a record price of $139.89 a barrel this week.

But private shareholders responded by reducing their holdings of commodity stocks by £1.2bn, selling almost all the £1.4bn-worth of shares that had been purchased in the sector since August 2007.

Private investors have chosen to cut their position in the largest sector in the market, even while prices are still rising.

John Roundhill, director of Capita Registrars, said many private investors may have identified a bubble in commodities that looks like it’s about to burst.

This private investor sell- off of commodities now exceeds the selling of financial stocks. At the start of the year, private investors shed £300m in banking stocks, before the sector’s underperformance in March.

“Private investors are better at judging the markets than they are often given credit for,” said Roundhill.