French investors pile out of money market funds
According to a recent research report from Lipper, French investors redeemed €15.3bn from money market funds in September, a significant chunk of the €52.9bn total outflows from European money market funds.
This represents the worst redemptions from European money market funds in any month since October 2008.
According to Ed Moisson (pictured), head of UK & cross-border research at Lipper, French institutions typically redeem large amounts on a quarterly basis to meet tax liabilities and other quarterly running costs. This reflects long-established cyclical behaviour, he explained.
Equity and bond funds were also badly hit, with redemptions of €21.2bn and €17.4bn respectively. This represents a significant increase in outflows from bond funds: last month €13.0bn was redeemed from the asset class.
The only area in fixed income to have prevailed is US dollar and sterling denominated corporate bonds which attracted €840m and €500m respectively.
Absolute return funds suffered €2.2bn of redemptions although those investing in mixed assets saw modest inflows (€180m).
In terms of sectors, European equities and emerging markets bonds experienced the heaviest redemptions, losing €3.5bn and €3.4bn respectively.
Overall only three fund markets saw net inflows this month (the UK, Czech Republic and Romania).
Lipper collects fund prices, assets, fees and related fund data from asset managers and their administrators on a daily and monthly basis.