Money market products offset fund outflows, says Lipper
The European funds industry saw outflows of €9bn in November, the best for six months thanks to inflows of €18.3bn into money market products, says the latest Lipper Fund Flash. Worldwide, bond funds were the most popular asset class in Q3 2011, according to the European Fund and Asset Management Association (EFAMA).
Long-term funds suffered redemptions of €27.3bn (ex-money market funds), a move for the worse after last month’s progress (-€14.5bn), the Lipper report says.
Standard Life topped the group sales chart this month, with net sales of €1.1bn, ahead of Prudential/M&G (€680m). Both groups enjoyed inflows across their bond, equity and mixed asset products.
Bond funds suffered outflows of €13.6bn, as investors withdrew from both Global Bonds (-€1.2bn) and high yield products (-€1.5bn). This total was worse than for equity funds for the first time since April.
Sales activity for long-term funds may well finish with more than €45bn of outflows in 2011, although this masks a significant divide between the first half of the year (inflows of €96bn) and the second half (outflows around €140bn).
EFAMA’s international report shows that investment fund assets worldwide declined by 4.7% during the third quarter to stand at €18.58trn at end September 2011. In US dollar terms, worldwide investment fund assets decreased 10.9% to $25.09trn. The appreciation of the US dollar vis-à-vis the euro during the quarter explains this result.
Worldwide net cash flows into investment funds turned negative during the third quarter, registering net outflows of €104bn, compared to net inflows of €147bn in the previous quarter. This turnaround came on the back of strong net withdrawals from long-term funds.
Long-term funds (all funds excluding money market funds) experienced net outflows during the quarter of €58bn, compared to net inflows of €206bn in the second quarter.
Bond funds continued to enjoy net inflows, albeit at a reduced level, during the quarter (€7bn, compared to €70bn in the previous quarter).
Equity funds experienced a swing in net flows to register net outflows of €79bn during the third quarter, compared to net inflows of €16bn in the previous quarter.
Balanced/mixed funds also experienced a turnaround in net sales during the quarter to register net outflows of €14bn.