eVestment: Investment flows negative in second quarter
31 August 2018 London
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Net institutional flows measured -$177.4 billion in the second quarter of 2018 ending a five-quarter streak of net allocations, according to the traditional asset flows report published by eVestment this week.
Cumulative institutional flows over the past year ending 30 June totalled -$15.2 billion.
Fixed income managers, excluding cash management strategies, saw aggregate redemptions of -$17.8 billion in Q2 2018.
The quarter marked a reversal from the preceding two-year period which saw institutional inflows totaling $767.7 billion for a quarterly run rate of $96.0 billion, noted eVestment.
Outflows during the second quarter were driven in aggregate by active fixed income redemptions with passive strategies drawing $19.9 billion.
Europe fixed income (excluding cash management, and emerging markets debt strategies) saw net institutional allocations of $11.6 billion and $0.6 billion during the quarter, it added.
Equity strategies registered net institutional outflows of -$138.8 billion. Active managers accounted for -$94.8 billion of the total and passive strategies -$43.9 billion.
US equity managers saw net redemptions of -$64.8 billion and non-US managers -$74.0 billion.
There were a handful of reasons to be upbeat on US equity flows despite poor headline figures, said eVestment.
The period under review marked the second quarter of net redemptions deceleration for active US equity managers (falling from -$88.8 billion in 4Q’17 to -$52.6 billion in Q2 18).
Top-line outflows from passive strategies were largely driven by the large assets under management base of core S&P 500 and Russell 1000 products.
Passive all cap strategies saw inflows of $6.3 billion, passive small cap $4.0 billion, and a number of style-biased large cap passive strategies also saw net allocations.
Results in the non-US equity space were more discouraging with headline outflows accelerating quarter on quarter and spread across a variety of geographies, commented eVestment.
The one cross-section showing institutional demand during the quarter was global/international growth strategies.
Net allocations totalled $3.5 billion for all country world index ex-US growth and $3.3 billion for global growth.
Cumulative institutional flows over the past year ending 30 June totalled -$15.2 billion.
Fixed income managers, excluding cash management strategies, saw aggregate redemptions of -$17.8 billion in Q2 2018.
The quarter marked a reversal from the preceding two-year period which saw institutional inflows totaling $767.7 billion for a quarterly run rate of $96.0 billion, noted eVestment.
Outflows during the second quarter were driven in aggregate by active fixed income redemptions with passive strategies drawing $19.9 billion.
Europe fixed income (excluding cash management, and emerging markets debt strategies) saw net institutional allocations of $11.6 billion and $0.6 billion during the quarter, it added.
Equity strategies registered net institutional outflows of -$138.8 billion. Active managers accounted for -$94.8 billion of the total and passive strategies -$43.9 billion.
US equity managers saw net redemptions of -$64.8 billion and non-US managers -$74.0 billion.
There were a handful of reasons to be upbeat on US equity flows despite poor headline figures, said eVestment.
The period under review marked the second quarter of net redemptions deceleration for active US equity managers (falling from -$88.8 billion in 4Q’17 to -$52.6 billion in Q2 18).
Top-line outflows from passive strategies were largely driven by the large assets under management base of core S&P 500 and Russell 1000 products.
Passive all cap strategies saw inflows of $6.3 billion, passive small cap $4.0 billion, and a number of style-biased large cap passive strategies also saw net allocations.
Results in the non-US equity space were more discouraging with headline outflows accelerating quarter on quarter and spread across a variety of geographies, commented eVestment.
The one cross-section showing institutional demand during the quarter was global/international growth strategies.
Net allocations totalled $3.5 billion for all country world index ex-US growth and $3.3 billion for global growth.
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