Emerging markets and US attract ETF flows

Exchange-traded fund (ETF) investors continued to move out of Eurozone equities last month, favouring emerging markets and the US. According to data from Amundi, emerging market equity ETFs saw €1.15 billion of inflows in August, whereas US equities attracted €485 million. However, Amundi said that Eurozone equity ETFs were still seeing outflows. Net redemptions were €390 million and €37 million for unhedged and hedged share classes, respectively. A similar pattern emerged for fixed income ETFs, with investors piling into emerging market government debt to the tune of €1.80 billion. In the sovereign space, a lack of yield or negative yields in some cases, saw investors pull €252 million from “broad maturity” Eurozone government bonds and €112 million from shorter maturity bonds. Investor interest was split between Eurozone corporate bonds – which attracted €519 million in new money – and the US, which saw €474 million in new money. One area of the corporate bond space that has failed to continue its earlier resurgence is US high yield, which saw outflows of €233 million last month. ©2016 funds europe

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