European investors seek out safer assets in August

European flagsThe European fund industry saw net flows of €18.5 billion during August, a slower rate than in July and with most money seeking bonds.

Lipper data for August shows bond funds and mixed asset products topping the list for mutual funds during the month, with inflows of €11.5 billion and €7.5 billion respectively.

The third best asset type in terms of net flows was property funds, with a significantly lower €0.7 billion. In contrast, alternative/hedge funds saw net outflows of €0.5 billion.

For long-term funds, asset allocation products were the best sellers with €3.8 billion of inflows, followed by flexible bonds at €2.7 billion and global currency bonds at €2.6 billion. In contrast, US dollar corporation high yield bonds suffered the worst net outflows, at €2.8 billion.

BlackRock topped the master groups by sales and asset growth for the month with €2 billion in net sales, beating DeAWM at €1.5 billion and Vanguard at €1.4 billion. The HSBC FTSE All-World Index was the top selling fund, with estimated net sales of €1.1 million, followed by the Vanguard S&P 500 Ucits ETF and the iShares Core DAX Ucits ETF.

For the single markets, Italy repeated its July performance by maintaining the highest net flows at €4.1 billion in August. Germany and Spain followed with €1.3 billion and €1.1 billion. The UK, Austria and Turkey all saw outflows during the month.

Bond funds, with projected net inflows of €3.6 billion, are expected to be the best-selling asset class again in September, when looking at Luxembourg- and Ireland-domiciled long-term mutual funds.

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