Global Mutual Fund Industry on Track for another Record Year

Year-to-date global long-term fund flows through April 2011 reached $268 billion, according to Strategic Insight’s Global Mutual Fund Review.

Equity funds pulled in $125 billion, while bond funds posted a $76 billion net inflow for the month.  

“This puts the industry on track for another year of $750 billion to $1 trillion in cash net flows in 2011,” stated Daniel Enskat, Head of Global Consulting at Strategic Insight, an Asset International company. “April was the best month since October 2010, with close to $100 billion in flows, mostly from the U.S. and cross-border vehicles,” Enskat added. “Equity funds are the main driver of flows thus far in 2011, accounting for half of the total.”  

Cross-border funds in Europe and abroad have been driving net flows for mutual funds, and year-to-date accounted for 80% of cash flows ($77 billion) outside of the U.S. (90% when only looking at Europe). Due to their flow dominance, cross-border UCITS’ share of total UCITS assets has risen from less than 10% a decade ago to nearly 40% today.    

Looking at the top cash flow cross-border managers thus far in 2011, Franklin Templeton continues to hold the top spot, followed by Blackrock and JP Morgan,” noted Enskat.“Just as importantly, boutique managers Investec and M&G entered the top 10 cross-border fund manager league table on the strengths of their flagship themes and products.”  

The data also showed the first few months of 2011 brought a wide range of interesting and diverse fund launches by region.  In Asia, China’s top themes include SRI, capital protection, passive equity, and stable income.In Europe, the largest gains are around capital protection via bank distribution.On a cross-border basis, emerging market local currency debt, absolute return, lifecycle funds, and RMB bonds led the way for cash flows.  

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