Ucits suffer largest outflows since 2008 – but UK bucks trend

Canary Wharf2Ucits funds have seen the largest net outflows since close to the start of the financial crisis due mainly to a sharp fall in fixed income sales.

Ucits registered net outflows of €65 billion across Europe in June, which compares to net inflows of €34 billion the previous month.

The European Fund and Asset Management Association (Efama), which compiled the numbers, says those were the largest net outflows from Ucits since October 2008. Lehman Brothers collapsed in September 2008.

While equity funds suffered outflows of €9 billion in June - €1 billion more than in May - fixed income funds were hit harder, with outflows of €18 billion.

Non-Ucits funds, on the other hand, increased their sales to €9 billion from €5 billion. Special funds, reserved for institutional investors, took in most of this at €8 billion.

“Rising long-term interest rates and market expectations that the Federal Reserve will begin tapering its quantitative easing programme before the end of this year fuelled large withdrawals from bond funds in June, and also negatively impacted equity funds,” says Bernard Delbecque, director of economics and research at Efama.

However, figures out today for July show that net retail fund sales in the UK were at their highest level since April 2011.

The Investment Management Association says net sales reached £2.2 billion (€2.6 billion) – the third time this year sales have surpassed £2 billion.

Equities were the best-selling asset class, with net retail sales of £1.4 billion – the highest since December 2010. Global equity funds were the best-selling, with equity funds invested in the UK, North America and Europe also doing well.

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