Fixed-Income Fund Inflows in Europe

Fixed-income fund inflows in Europe remained robust last month, while equity and multi-asset funds both saw aggregate outflows, according to UBS analysts in their monthly report.

According to the August 2024 Monthly Monitor, fixed-income funds continued to attract strong investor interest, a trend noticeable despite overall market volatility.

The report notes that August active fund outflows for the listed European and UK asset managers totaled €1.5 billion, equivalent to an annualized 1.8% of assets under management (AUM). This represents the weakest month since April but still shows improvement over the average monthly outflows in the first half of 2024.

Within this broader trend, fixed-income funds stood out as the primary beneficiary of inflows, UBS notes.

By company, Man Group emerged as a notable performer, generating the strongest active inflows among the asset managers covered, with a 7% increase in AUM on an annualized basis.

Conversely, the abrdn Emerging Markets Equity Income Fund, Inc (NYSE: AEF) and Ashmore Group Plc (LON: ASHM) reported the most significant outflows, with abrdn seeing a 15% reduction and Ashmore a 20% reduction in AUM on an annualized basis.

Overall, August saw a modestly positive performance across major global equity indices, with the S&P 500, MSCI World, STOXX 600, and FTSE 100 all posting gains of 1-3%. Key fixed-income indices also experienced increases of 1-2%.

“European and US equity market volatility moderated after a 50% spike in early August,” UBS analysts pointed out.

Meanwhile, shares of traditional European asset managers declined by 1.8% on a weighted average basis in August, leading to an underperformance of 340 basis points compared to the STOXX 600.

Among this group, Ashmore and Jupiter delivered the strongest performance, each gaining 2% during the month, while Schroders (LON: SDR) was the weakest performer.