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Investors expect increase in fixed income ETF flows, study finds

increase in fixed income ETFThe majority of institutional investors and wealth managers believe flows into fixed income exchange-traded funds (ETFs) will be higher in 2020 than last year, research suggests.

While 24% believe there will be a slight increase in flows, 64% say fixed income ETF inflows will increase “dramatically”, according to the study by Tabula Investment Managers.

Throughout last year in Europe, over €55 billion was added overall to fixed income exchange-traded products and ETFs. So far this year, the investment vehicle has received €8.5 billion of new investor cash, according to Tabula.

In terms of reasons why professional investors expect flows to increase, 70% said it will be due to more fixed income ETF products available, and therefore more funds available to invest in.

Over half said it would be because of greater innovation in the sector, while 32% said it would be due to ‘sector rebalancing’.

Tabula’s newly appointed chief investment officer, Jason Smith, said: “This is a very exciting time for the fixed income ETF space. Last year saw record flows into fixed income ETFs, and our research suggests 2020 could be another record year. There is growing demand from investors for new innovative solutions that offer real and very specific solutions.”

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