European investors show strong aversion to equities

Lipper FMI’s European fund flow stats show investors moving to fixed income and money market funds.


Not including money market funds, European fund flows in May were €13.2bn (£11.8bn) compared to €26.6bn (£23.6bn) in April. With money markets included, total sales amounted to €22.7bn.

The biggest losses of the month were equity fund managers with outflows of €215m although the sales of equity exchange-traded funds saw this figure back in the black to the tune of €2bn. This compares with equity inflows in April of €13.4bn.

For the fifth consecutive month, bond sales improved, rising from €7.7bn to €8.5bn, though was less reliant on high yield bonds than previously. High yields added €2.7bn in May to take its annual total to €21.6bn.

Elsewhere, global bonds attracted €3.3bn and emerging market bonds continued their revival with another €2.2bn.

The huge flows into money market funds (€9.6bn) clearly demonstrate investors’ equity aversion and represent a nine-month high.

Looking at alternative assets, commodity funds saw €450m of new money while raw materials dropped into negative territory of €180m. Their year-to-date totals are €4.2bn and €4.3bn respectively.