June 2015: A tough month for bond funds
European investors pulled money out of mutual funds during June 2015. That said, mixed-asset funds enjoyed opposite flows with estimated net inflows of €12.1 bn during the month, followed by real estate products with €0.2 bn and commodity funds with €0.03 bn. However, bond funds faced estimated net outflows of €17.5 bn, bettered by equity funds (-€2.5 bn), alternative/hedge products (-€2.1 bn), and ”other” funds (-€1.3 bn). These flows added up to estimated net outflows of €11.1 bn from long-term investment funds for June.
Despite these flows for June, the European investment industry enjoyed outstanding estimated net inflows of €296.5 bn into long-term investment funds for the first six months of 2015.
Money market products
Even money market products, an asset class that can be seen as a safe haven, faced massive outflows (-€34.7 bn) for June. Despite these outflows, money market funds still showed net inflows of €1.2 bn for the first half of 2015.
The flows for the money market segment brought the overall net flows for June to minus €45.8 bn and to a positive €297.8 bn for the first six months of the year.
Money market products by sector
Within the money market segment Money Market USD (+€7.9 bn) was the best selling sector, followed by Money Market SEK (+€0.3 bn) and Money Market “Other” (+€0.02 bn). At the other end of the spectrum Money Market EUR suffered net outflows (-€28.4 bn), bettered by Money Market GBP (-€12.8 bn) and Money Market EUR Leveraged (-€0.3 bn).
Graph 1: Estimated net sales by asset type, June 2015 (€bn)
Fund flows by sectors
Mixed-Asset EUR Flexible-Global (+€4.2 bn) was the best selling sector among the long-term funds, followed by Mixed-Asset EUR Conservative-Global (+€3.3 bn), Mixed-Asset EUR Balanced-Global (+€2.7 bn), and Equity Japan (+€1.9 bn) as well as Equity Eurozone (+€1.2 bn). At the other end of the spectrum Bond EUR suffered net outflows (-€5.0 bn), bettered somewhat by Absolute Return EUR (-€5.0 bn) and Bond EUR Corporates (-€3.5 bn) as well as Bond EMU Government (-€2.5 bn) and Equity Asia Pacific ex-Japan (-€2.3 bn).
Graph 2: Ten top sectors, June 2015 (€bn)
Fund flows by markets
Single fund market flows (including money market products) showed a negative picture for June, with only 6 of the 34 markets covered in this report showing net inflows. Luxembourg (+€7.9 bn), Switzerland (+€0.7 bn), and Denmark (+€0.2 bn) were the domiciles with the highest overall inflows, while France was the single market with the highest net outflows (-€25.7 bn), bettered by Ireland (-€10.2 bn) and Italy (-€8.1 bn).
Graph 3: Estimated net sales by country, June 2015 (€bn)
Within the equity sector funds domiciled in Luxembourg (+€2.2 bn) led the table for June, followed by those domiciled in Ireland (+€1.6 bn), Switzerland (+€0.5 bn), Germany (+€0.3 bn), and Poland (+€0.01 bn). Equity funds domiciled in Belgium (-€2.0 bn), the United Kingdom (-€1.7 bn), and Sweden (-€1.0 bn) stood at the other end of the table.
For bond funds inflows were driven by funds domiciled in Denmark (+€0.6 bn), followed by funds domiciled in Switzerland (+€0.2 bn) and Liechtenstein (+€0.04 bn), while all other domiciles faced estimated net outflows from bond funds. Luxembourg (-€4.6 bn) was the domicile with the highest net outflows from bond funds, bettered somewhat by funds domiciled in Spain (-€3.2 bn) and Italy (-€3.0 bn).
With regard to mixed-asset products the flows were driven by net inflows into funds domiciled in Luxembourg (+€5.8 bn), followed by those domiciled in Spain (+€2.6 bn), France (+€1.6 bn), Belgium (+€0.9 bn), and Ireland (+€0.8 bn). Despite the general market trend, only 7 of the 34 countries covered in this report showed net outflows from mixed-asset products, with funds domiciled in the United Kingdom showing the highest outflows (-€1.0 bn), bettered somewhat by funds domiciled in Guernsey (-€0.4 bn) and funds domiciled in the Netherlands (-€0.1 bn).
Fund flows by promoters
JP Morgan, with net sales of €5.4 bn, was the best selling group for June overall, ahead of Vanguard (+€2.0 bn) and HSBC (+€1.6 bn).
Table 1: Ten best selling groups, June 2015 (Euro Billions)
Considering the single-asset bases, Eastspring—a member of the Prudential group (+€1.3 bn)—was the best selling promoter of bond funds for June, followed by Eurizon Capital—the asset management arm of Intesa SanPaolo (+€0.7 bn)—and Goldman Sachs (+€0.6 bn) as well as Laegernes Pensionsinvestering (+€0.6 bn) and Mercer (+€0.4 bn). Within the equity space Vanguard (+€1.4 bn) stood at the top of the table, followed by BlackRock (+€1.1 bn), Fidelity (+€0.7 bn), and Credit Suisse (+€0.7 bn) as well as Amundi (+€0.6 bn). Deutsche Asset & Wealth Management (DeAWM) (+€0.9 bn) was the leading promoter of mixed-asset funds for June, followed by the Spanish BBVA (+€0.9 bn), Allianz Global Investors (+€0.9 bn), and BlackRock (+€0.7 bn) as well as JP Morgan (+€0.6 bn).
Best selling funds
The ten best selling funds gathered inflows of €6.5 bn for June. With regard to the overall flows, it is remarkable that none of these ten funds were mixed-asset funds. The ten top funds were split into four equity funds (gathering €2.2 bn for June), four bond funds (gathering €2.5 bn), and two absolute return funds (gathering €1.8 bn).
Table 2: Ten best selling funds, June 2015 (€bn)
Detlef Glow is head of Lipper EMEA Research