Investment platform sees flows into EM funds soar
Online retail investment platform Rplan.co.uk saw a 75% year-on-year increase in flows into emerging market funds on its retail online investment platform between 1 June and 15 August.
In contrast to this, when looking at China-only funds, it saw a 54% decline.
Rplan.co.uk has over 150 emerging market funds on its platform, and at the moment the five most popular ones in terms of flows over the past six weeks have been Neptune India, Jupiter India, BlackRock Emerging Markets Equity Tracker, JPM Emerging Markets and Neptune Africa.
“Between the end of 2010 and December 2015, the MSCI Emerging Market Equity Index fell by around 30% but this year it’s up by over 14%. Some market commentators are saying there is a turn in the cycle of emerging market equities and this is fuelling investors to increase their exposure in this asset class,” Stuart Dyer, Rplan.co.uk’s CIO, said.
“In contrast to this, the Shanghai Composite Index is down by around 14% this year, and this follows a huge level of volatility in Chinese stocks last year. This, combined with concerns about the Chinese economy and the actions of the government to intervene in its stock market, has spooked some investors and many are voting with their feet and withdrawing their investments here to go elsewhere.
“Emerging markets are experiencing a bit of a boom in terms of investor interest but they have gone cold on the biggest emerging market in the world – China,” he said.