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UCITS outflows hit record level in June
29 August 2013
Fixed income outflows contribute to worst level since height of crisis, says EFAMA
Body: June saw the worst outflows from UCITS assets since October 2008, according to the European Fund and Asset Management Association (EFAMA).
EFAMA's data, which covers 26 fund management associations across Europe and represents more than 99.6% of UCITS and non-UCITS assets, shows net outflows of €65bn ($86bn), compared to net inflows of €34bn the month prior. It said a rout in fixed income funds, driven largely by investor changing sentiment as a result of the US Federal Reserve's comments on the end of QE, was to blame.
Bernard Delbecque, director of economics and research at EFAMA, said: “Rising long-term interest rates and market expectation 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.”
Bond funds saw outflows of €18bn, while equity funds also saw outflows of €9bn. Long-term UCITS, excluding money market funds, experienced outflows of €25bn, falling from net inflows of €39bn in May.
Although money market funds saw the largest outflows, at €40bn, up from €5bn at the end of May, EFAMA said this was a cyclical pattern that occurred at the end of each quarter – the end of December 2012 saw outflows of €33bn, while June 2012 saw outflows of €24bn.
Sales of institutional investor-only special non-UCITS funds rose to €9bn, up from €5bn in May.
At the end of June, total net UCITS assets were €6.5trn – a 3.7% fall from May.