Russian retails funds lost money again last week

Russian retail funds have seen outflows once again over the week to August 8, after $211m was committed to Russia-focused funds last week.

Data from Emerging Portfolio Fund Research shows that Russian funds have lost $60m in the last week. However, only $7m of this was redeemed from exchange traded funds, which last week saw inflows of over $200m.

ETF investors were more active in the whole emerging market space last week, adding $807m.

Overall emerging market funds have been in favour with investors over this period. Total inflows amounted to $784m – below the $1.5bn committed the week before, but still a positive trend for the second week running. EM balanced funds saw the addition of $897m, while all other major country funds reported redemptions.

Troika Dialog said: “Summer flows are always quiet. It is of course midsummer, and investor flows tend to be very low in August. What the fund flows in EM assets tell us is that investors remain hopeful of a market rally, specifically a rally in risk assets, in the autumn.”

A report by Uralsib Capital says: “We don’t expect a clear trend in Russian fund flows in the near future, since economic growth prospects remain hazy.”

Total flows into Russian funds since the start of the year have amounted to $865m. At the same time private capital flight out of the country in the second quarter has decreased significantly to $9.5bn from $33.9bn in Q1. The Bank of Russia’s official capital flight forecast for this year is $10.5bn.

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