French funds dropped in Q2 2016

France-domiciled funds had assets under management of €805.4bn as at end of June 2016, down 0.8% on a quarterly basis, data consultant EuroPerformance said.

Total outflows of €5.1bn have been reported during the second quarter of 2016. Since the start of the year, AUM in France-domiciled funds have slipped by 1.9%.

EuroPerformance explained the outcome of the Brexit vote has impacted performances delivered in April and May.

Bond strategies have drawn some €2.4bn in net inflows in Q2 2016.

Globally, the performances of French funds invested in European and emerging markets bonds were respectively up 0.9% and 3.9% qoq. High yield bond funds have been impacted in June and have delivered a performance of +1.3% over the quarter.

The equity fund segment has seen mixed performances in Q2 2016. The performance of European equities funds domiciled in France has dropped by 6% in June and 2.3% on the whole quarter. Since the beginning of the year, it slumped by 8.4%.

On the opposite, France-domiciled funds invested in Northern American equities, Asian and emerging markets stocks have seen positive performances over the quarter.

Most inflows have been in emerging markets equity funds (+€924m) while outflows have been seen in European equity funds (-€1.2bn).

Convertibles strategies domiciled in France have seen a 0.9% drop in performance and outflows of €421m over the quarter. As at end of June 2016, assets managed in the asset class amounted to €14.5bn, down 19% since January 2016.

According to EuroPerformance, nine in ten money market funds invested in short-term treasury have faced a decrease in AUM over Q2 2016. The proportion reaches one in two funds over the long-term treasury segment.

Some €12m of net inflows have been into commodities but EuroPerformance stressed commodity funds do not draw investors despite showing good performances in Q2 2016.

The real estate segment has been one of Q2’s winners in the French fund market, having boarded €1.2bn of net inflows. Amundi Immobilier has recorded most inflows during the quarter. Assets managed in France-domiciled property funds reached €6.2bn at end May 2016, up 36% since the start of the year.

Long/short equity strategies have been also favoured during the second quarter of 2016 with net inflows of €437m. However, flexible funds domiciled in France have faced outflows of €144m in Q2 2016.

Between March and end of May 2016, alternative managers have seen outflows of €170m and total AUM managed over the segment in the French fund market amounted to €1.2bn as of 31 May 2016, down 11.2% qoq.

As for passive strategies, ETFs listed in France gathered €61.6bn of assets at the end of June 2016 with inflows of €243m and a 0.9% rise in performance over the quarter.

Equity ETFs have faced outflows while the demand has been strong in ETFs replicating EM indices and bond ETFs.

Adrien Paredes-Vanheule
Adrien Paredes-Vanheule is French-Speaking Europe Correspondent for InvestmentEurope, covering France, Belgium, Geneva and Monaco. Prior to joining InvestmentEurope, he spent almost five years writing for various publications in Monaco, primarily as a criminal and financial court reporter. Before that, he worked for newspapers and radio stations in France, in particular in Lyon.

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