Bond funds attracted strong inflows in Q2 2024, making them the top-performing category in the first half of 2024, according to data from the European Fund and Asset Management Association (Efama), the asset management association.
In its European Quarterly Statistical Report for Q2 2024, Efama revealed continued robust performance in the bond fund sector.
Thomas Tilley, senior economist at Efama, noted: “In Q2, all fund categories saw net inflows, with bond funds maintaining their momentum. This follows the trend seen in Q1, as investors prepared for anticipated interest rate cuts.”
Net assets of Ucits and alternative investment funds (AIFs) rose by 2.2% during Q2, driven by net inflows of €148 billion. Of this, Ucits accounted for €134 billion, while AIFs contributed €14 billion. Bond funds alone captured €79 billion in net inflows, reflecting sustained demand, although slightly below the €95 billion recorded in Q1.
Bond funds saw third best half-year on record in H1 2024: Morningstar
Long-term funds were particularly in demand, with Ucits and AIFs registering €119 billion in net inflows in Q2, compared to €85 billion in the first quarter. Money market funds also saw an increase, with €29 billion in inflows, up from €21 billion in Q1.
One area of concern remains Sustainable Finance Disclosure Regulation (SFDR) Article 9 funds, which saw net outflows for the third consecutive quarter, amounting to €6.5 billion. In contrast, SFDR Article 8 funds maintained steady inflows of €19 billion.
Highlights for H1 2024 show a 6.7% increase in net assets of Ucits and AIFs, with Ucits rising by 8.1% and AIFs by 4.3%. Net sales of bond Ucits reached €155 billion, with ETFs in this category attracting €26 billion in net inflows, while non-ETFs saw net inflows of €129 billion.
On the other hand, multi-asset Ucits experienced net outflows of €28 billion, in contrast to the strong performance of multi-asset AIFs, which attracted €19 billion in net new money, particularly from Germany and the UK. Additionally, money market fund Ucits reported net inflows of €51 billion.
