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European fund data shows that investors are seeking the safe haven of bond funds

News Team, 06/09/2019

While the exodus from UK-focused equity funds seems understandable given the fragile state of the country’s political situation, it seems redemptions from equity funds appear to be a European wide phenomenon.

Data from the European Fund and Asset Management Association shows that UCITS equity funds recorded €32 billion of outflows in the second quarter, up from the €27 billion of redemptions made in Q1 this year.

However, bond funds saw inflows of €78 billion during the same period, comparable to the €79 billion of new money they received in Q1.

Multi-asset funds were also in the black, seeing the same level of sales in Q2 as Q1, €2 billion.

This said, the total assets by UCITS continues to rise. Assets increased by 1.4 percent in Q2 2019 to reach €10,144 billion. Since the end of 2018, net assets of UCITS grew by 9.3 percent.

Overall, UCITS funds recorded inflows of €41 billion in Q2, slightly down on €51 billion of sales seen in Q1. However, on a year-on-year basis, inflows almost halved in the first of 2019, down from €185 billion to €87 billion.

The ETF market also slowed down in Q2. There was €9 billion of inflows in Q2 2019, down from €26 billion in Q1 2019. However UCITS ETFs attracted net sales of €35 billion so far this year, a large increase on the €3 billion the first half of 2018.

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