Absolute return strategies are the asset class most European fund selectors wanted to buy even before the recent rise in volatility in bond and equity markets, all except the Dutch who are not so keen on the strategy.
State Street Global Advisors (SSGA) is focusing part of its fixed income portfolio on global convertible bonds due to expectations of higher interest rates and a stronger equity market over the next 12 months, but fund selectors are only mildly interested in the asset class.
Luxembourg’s popularity as an international fund management centre helped boost assets under management (AUM) in the tiny Duchy by 11.18% in 2017 to reach €4.16trn, according to the Association of the Luxembourg Fund Industry (ALFI).
European investors increased their risk appetite in 2017, recording high inflows into pure equity funds compared with outflows in the previous year, helped by a big rush into passive equity funds, according to a Thompson Reuters Lipper report.
Against the backdrop of a US bond market sell-off in January, a look at the performance of European US government bond funds shows that not a single one has beaten the 10-year treasury note return of 7.25% over the three years to 31 December 2017, according to FE Analytics.
Japanese equities had the largest positive shift in net sentiment across pan-European fund selectors during the last quarter, according to research from Portfolio Adviser’s sister publication, Expert Investor. Click through the slides below to find out more about the views of the industry toward Japanese equities.
Frontier market funds are leading Europe’s emerging market fund pack with Charlemagne’s frontier market offering at the top, according to FE Analytics.
Europe’s passive funds will be given a boost in 2018 at the expense of active funds thanks to Mifid II’s drive for cost transparency, according to research firm Cerulli Associates.
While Italy faces election and non-performing loan (NPL) challenges, Aviva Investors believe that its market looks attractive for investors in 2018 but fund selectors warn the country should not be a core part of a global portfolio.
