European funds suffer outflows of €69 billion

Euro sign1The European funds industry suffered net outflows of €69.3 billion in 2011, only the second year in a decade that total flows were negative, says data provider Lipper. The previous year was 2008, when outflows were substantially larger at nearly €300 billion.

December was a bad month in terms of flows, with redemptions from long-term funds reaching €23 billion. This calculation excludes money market funds.

BlackRock had the greatest fund sales over the year, with €14.3 billion, excluding money market instruments. But if exchange-traded funds are also excluded, Franklin Templeton did best with €12.6 billion, a result attributable to its popular bond funds.

Funds that did well tended to focus on global investing. Global bond funds attracted net inflows of €16.4 billion over the year while global equity funds gained €6.3 billion. Investors also placed value on mixed asset funds, which can spread their risk across different asset classes and deploy 'absolute return' strategies; these funds had net inflows of €12 billion.

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