In January 2021, mutual fund flows in Europe continue to be very sustained despite stocks markets’ pauses and bond prices falling. Total flows reached €90bn which is the third-highest figure in the past 12 years. It is also close to December’s all-time record high of €102bn (Morningstar Jan 2020).

Active funds dominate the flows in January with nearly 60% of inflows. Active equity fund flows were again the big winners in this period of pandemic (see previous posts) at €40bn close to November 2020 12-year record.

Passive equity fund flows reached €12bn a significant decrease after the record reached in December 2020 at €23bn which was the second-best month of inflows over the past 12 years. Yet passive fund flows continue to be sustained above their one-year average of €8bn.

In the fixed income space, active flows dominate but are down 22% at €22bn in the context of rising interest rates while passive flows are only down 5% at €6bn.

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