24/05/2011
By Matt Ritchie
Net inflows to UCITS funds increased to €30 billion in the first quarter of this year, from €26 billion in the previous three months, according to the European Fund and Asset Management Association (EFAMA).
In its latest quarterly statistical release, EFAMA said that long-term UCITS (UCITS excluding money market funds) recorded inflows of €39 billion over the period, well down on the €67 billion recorded in the final quarter of last year.
Announcing the release of the statistics, the Association said the drop is largely explained by a sharp reduction in net inflows to equity funds, while bond and balanced funds enjoyed increased net inflows during the quarter.
“Tension in the markets caused by unrest in North Africa and the Middle East, the earthquake in Japan and tensions in the sovereign debt markets caused caution among investors.”
Money market funds saw net outflows of €9 billion, though this was at a much lower rate than the previous quarter’s outflows of €41 billion.
“This reduced level of net outflows comes at a time when net assets of money market funds are back at their pre-crisis levels, signalling a possible end to the readjustment of investors’ portfolios against the background of a pick-up in short-term interest rates,” EFAMA said.
Total net assets of UCITS decreased by 0.9% in the first quarter, to stand at €5.95 trillion at the end of March. Net assets of money market funds decreased 2.6% during the quarter, followed by equity funds dropping by 1.5% and bond funds by 0.4%. Meanwhile, balanced funds broke the trend and enjoyed an increase in net assets of 1.3%.
Total net assets of non-UCITS increased by 1.2% in the first quarter, reaching €2.16 trillion at the end of March.
“Much of this increase is due to special funds reserved to institutional investors, which enjoyed net inflows during the quarter of €28 billion.”
The combined assets of the investment fund market in Europe decreased in the first quarter by 0.4% to €8.1 trillion at the end of the first quarter. UCITS assets accounted for 73% of the total investment fund market in Europe, with non-UCITS accounting for the remainder.
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