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UCITS and AIFs reach record net sales in December 2020

News Team, 23/02/2021

Net sales of UCITS and AIFs increased to EUR 174 billion in December, a record figure that more than doubles its November total (EUR 78 bilion), according to the latest data from the The European Fund and Asset Management Association (EFAMA).

The organisation has published its Investment Fund Industry Fact Sheet for December together with an overview of the net sales data for UCITS and AIFs in 2020.

Its findings revealed that overall, UCITS recorded net inflows of EUR 121 billion, compared to net inflows of EUR 75 billion in November, while long-term UCITS (UCITS excluding money market funds) recorded EUR 96 billion of net sales, up from EUR 72 billion. In addition, UCITS money market funds recorded net inflows of EUR 25 billion, in contrast to EUR 4 billion the month before.

The most significant increase could be seen in the recorded net inflows of AIFs, which rose to EUR 53 billion, considerably up from EUR 3 billion in November.

This flurry of activity resulted in total net assets of UCITS and AIFs increasing by 2.3 percent to EUR 18,815 billion.

Commenting on the figures, Thomas Tilley, EFAMA’s senior economist said: “Net sales of UCITS and AIFs surged to an absolute record in December 2020, as investor confidence in a successful exit from the Covid-19 crisis continued to strengthen.”

Meanwhile, bond funds registered net sales of EUR 26 billion, compared to EUR 8 billion in November, while multi-asset funds recorded net inflows of EUR 9 billion, up from EUR 4 billion. Equity funds registered net inflows of EUR 59 billion, just as in November.

The results reflect a period of sustained inflows within UCITS in 2020. After suffering net outflows of EUR 314 billion in March, UCITS enjoyed nine consecutive months of net inflows which resulted in total net sales of EUR 467 billion in 2020, compared to EUR 391 billion in 2019 and average annual net sales numbered EUR 326 billion over the last ten years.

This theme of recovery was reflected across multiple asset classes. Net sales for equity funds rebounded to EUR 158 billion in 2020, compared to net outflows of EUR 6 billion in 2019. Money market funds rebounded to record net sales of EUR 214 billion in 2020 after reporting net outflows of EUR 45 billion in March.

It was a less positive picture elsewhere. Following net outflows from bond funds of EUR 156 billion in March, the sector recorded an end of year fall in total net sales of EUR 82 billion.

It was a difficult year for multi-asset funds too, with EUR 44 billion in outflows across March, barely recovering to record total sales for EUR 14 billion in 2020, compared to EUR 48 billion in 2019 and EUR 89 billion on average over the last ten years.

The demand for AIFs remained stable in 2020, as the pandemic had a very limited impact on net sales, which totalled EUR 154 billion in 2020, compared to EUR 151 billion in 2019 and average annual net sales of EUR 159 billion over the last ten years. Net inflows remained positive in March and turned slightly negative only in April (EUR 12 billion). Equity AIFs suffered from net outflows of EUR 11 billion in 2020, whereas real estate and other AIFs recorded net inflows of EUR 36 billion and EUR 86 billion, respectively.

Bernard Delbecque, senior director for economics and research, spoke positively about the overall developments of 2020.

He said “The increase in net sales of UCITS in 2020, despite the uncertainty surrounding the pandemic, is a strong vote of confidence for UCITS. Overall, investors remained confident in the ability of the European investment fund industry to generate returns and minimize risks. This is encouraging for the future because the success of the Capital Markets Union largely depends on the willingness of European households to shift a greater share of their savings into capital market instruments.”

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