Global net sales of equity funds, money market funds turn negative

On the 12/22/20 at 7:28AM


Tuba Raqshan

Net sales of equity funds turned negative in the third quarter of 2020, while worldwide money market funds too recorded net outflows compared to inflows.

Latest quarterly international fund statistics by European Fund and Asset Management Association (EFAMA) revealed that net sales of equity funds turned negative (€24bn), due to large net outflows in the United States (EUR 124 billion) and despite net inflows in Europe (€45bn), other advanced economies (€33bn) and emerging markets (€23bn).

Similarly, worldwide money market funds (MMFs) recorded net outflows of EUR 168 billion, compared to net inflows of €441 billion in Q2 2020. The reversal of the trend was mainly driven by the turnaround in the United States, from net inflows of €270bn in Q2 2020 to net outflows of €197bn in Q3 2020. In Europe, however, MMFs continued to attract net inflows, amounting to €41bn (compared to €136bn in Q2 2020).

Bond funds attracted the vast majority of long-term fund sales (€279bn), mostly in the United States (€221bn) and Europe (€65bn). Multi-asset funds had robust net inflows (€100bn), with China accounting for a lion’s share of net sales (€91bn).

Despite strong net outflows from equity funds in the United States, net sales of worldwide long-term funds remained very high in Q3 2020, said Bernard Delbecque, senior director for economics and research, EFAMA. “A trend supported by continued demand in Europe and other advanced economies, the sharp increase in net sales of multi-asset funds in China and the sustained demand for bond funds in the United States,” added Delbecque.

Net Assets of Worldwide Regulated Open-End Funds (Data: EFAMA)
Net Assets of Worldwide Regulated Open-End Funds (Data: EFAMA)

Worldwide long-term funds recorded net inflows of €411bn in Q3 2020, compared to €387bn in Q2 2020. Europe and emerging markets accounted for the highest net sales (€156bn and €104bn, respectively), followed by the United States (€90bn) and other advanced economies (€61bn).

According to EFAMA? Net assets of worldwide investment funds increased by 1% in Q3 2020 to €52.2bn. Calculated in local currency, the United States and Europe, registered a net asset growth of 4.3% and 2.7%, respectively.