European equity flows hit their worst level since 2020
Net inflows on long-term funds totaled € 51.4 billion at the end of November, or € 15 billion less than in October, according to the firm’s analysis of open funds and ETFs domiciled in Europe. . This is mainly due to the drop in demand for large cap UK and European equities.
However, flows to bond funds increased significantly compared to the previous month, reaching € 18.5bn, which was their second best month since July 2020.
The company explained the numbers, citing the rise of Omicron leading to “a massive sell-off of equity funds at the end of the month,” while bond funds flourished on “massive inflows of global bonds and bond funds in euros “. .
Money market funds also attracted € 35.8bn in November, their second best result in 16 months. Morningstar said that “the flight to fixed income and money market products suggests that investors are looking for ways to protect their portfolios from inflation and become cautious, despite the strong performance of equities this year.”
Long-term funds classified under article 8 and article 9 of the SFDR respectively attracted € 24.2bn and € 7.9bn in net inflows. This continued the trend for Article 8 and Article 9 products to capture the majority of total flows that was noted throughout the year by Morningstar.
Global large-cap blended equity funds had the highest net inflows of any category identified by Morningstar, gaining € 9.3 billion in November, while pound-denominated government bond funds sterling recorded the largest net repayments at € 2.2 billion.
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In terms of winners and losers, the company reported that Phoenix Group led the list of companies by brand name in the active space, followed by JP Morgan and Deka. Aviva recorded the highest net outflows.
On the liability side, iShares attracted the most net inflows, followed by Amundi and Credit Suisse, while HSBC suffered the largest net outflows.
PUTM Bothwell Global Bond was the best seller in November (excluding money market products), while Aviva Investors Sterling Government Liquidity suffered the largest net outflows.