Investors exited European long-term funds in October in a scale last seen at the height of the eurozone crisis in August 2011.
The most recent edition of Morningstar’s European Asset Flows Commentary showed that long-term Europe-domiciled funds suffered net outflows of €35.3 billion in October.
The report said that European investors switched to risk-off mode in October during which record inflows of €52.8 billion had poured into money market funds.
Assets invested in long-term Europe-domiciled funds fell from €8.636 trillion in September to €8.350 trillion by the end of October due to a combination of falling asset prices and the outflows.
The falling price of equities chipped away more than €223 billion from the value of equity funds.
The report also found that:
• Equity funds haemorrhaged €11.7 billion in October
• Significant outflows hit growth funds, including sector technology funds illustrating a marked change in investors’ sentiment
• Redemptions of fixed-income funds were nearly at par
• Bond funds shed €11.5 billion as investors in corporate bonds were confronted by widening spreads
• Mixed-assets funds saw outflows of €6.2 billion, making October 2018 the second-worst month on record for the fund category since October 2008
• Alternative funds bled €6.19 billion
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