👀 News from the flow side # 3 : What happened in February 2021 to European mutal funds ?

7 April 2021

In February 2021, mutual fund flows in Europe continued to be sustained close to the January level. The context was mixed: higher equity markets on economic recovery & monetary policy expectations while inflation concerns drew bond prices lower. Total flows reached €87bn which is close to December’s record high of €102bn (Source: Morningstar Feb 2021).

Active funds continued to dominate the flows in February with nearly 78% of inflows. Yet passive fund flows showed a more favorable momentum up 8% at €19bn vs a decline of 4% for active funds at €68bn compared to January 2021.

Equity flows were down 7% in February. Active equity fund flows dominate but is down 10% vs January 2021 at €36bn. This is still more than twice their one-year average of €14bn. Passive equity fund flows are up 4% €11bn. They are above their one-year average of €8bn.

In the fixed income space, active flows dominated but are down 18% at €18bn. Passive flows were up 16% at €8bn, worth noticing in a negative backdrop of rising interest rates.

👉When analyzing active and passive funds, independence is the key to give a fair view from both side.

Marlene Hassine Konqui