European funds saw outflows during July despite a positive market environment.
According to Refinitiv Lipper, all asset types faced estimated net outflows for the month. At the same time, the overall fund flows for mutual funds and ETFs in Europe in July amounted to estimated net redemptions of €41.7 bn.
Long-term mutual funds posted estimated net outflows of (-€41.8 bn) for July.
Money market funds, down €0.1 billion, were the best-selling asset type overall for July 2022, while US government bonds were the best-selling sector among long-term funds, attracting €2.6 bn in inflows.
Ireland was the fund domicile with the highest net inflows, with €4.1 bn in inflows, followed by Switzerland, with €1.3 bn, and Norway, with €0.5 bn.
abrdn was the best-selling fund promoter in Europe for July, attracting €2.6 bn of inflows, ahead of State Street Global Advisors, €2.5 bn, and Legal & General, €2.5 bn.
Detlef Glow, Head of EMEA Research at Refinitiv Lipper, comments: “Given the positive market environment throughout July 2022, it was somewhat surprising that the European fund industry faced outflows over the month.
“That said, one needs to bear in mind that the geopolitical situation in Europe, the still ongoing COVID-19 pandemic, disrupted delivery chains, and increasing inflation and interest rates are impacting the expectations of the investors,” he added.
In the second quarter of the year, flows into sustainable equity funds dropped by 62% on the back of significant headwinds, data from Morningstar showed. Worries of a global recession, rising interest rates, the war in Ukraine and inflationary pressures were all touted by analysts as the cause for limited inflows during the period.
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