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With July, we see another month of outflows from equity funds

Despite the continued impact of the Russian invasion of Ukraine, European growth stocks posted double-digit increases, according to statistics from global data company Investment Metrics.

According to data source Morningstar, equity strategies resumed their trend of outflows in July, shedding more than £2.6 billion, but the rate has moderated compared to May and June.

In July, the US large-cap blend sector experienced outflows of £661 million, making it one of the four equity sectors with the worst performance. With an outflow of £591 million, the UK large-cap sector was the second-worst performance, followed by Europe ex-UK with a loss of £373 million. Global large-cap growth also experienced outflows of $290 million. UK equity strategies have experienced outflows of £10.9 billion over the past year, compared to $5 billion for US large-cap blend and Europe ex-UK.

A net inflow of £739 million was recorded for fixed income strategies throughout the month, with the top performing sector, global corporate, attracting net inflows of £280 million.

July was a banner month for money market strategies, with assets increasing by £15 billion and inflows of more than £1.2 billion, with the majority of inflows occurring during the previous 12 months (£1.4 billion).

Meanwhile, index strategies recorded a net inflow of £130 million, bringing the total for the year to £2.7 billion, while non-indexed funds experienced a net outflow of almost $1.2 billion.

Sustainable initiatives elsewhere recorded net inflows of £251 million, amounting to annual inflows of £29.2 billion. There were outflows of £1.5 billion from non-sustainable strategies, with £36.2 billion leaving these strategies over the course of the year.

On the asset management front, BlackRock suffered its largest monthly net outflow since 2018 with £1.6 billion, including an outflow of £90 million from BlackRock European Dynamic and substantial withdrawals from its BlackRock ACS World ESG Equity and BlackRock ACS World ex UK Equity passive strategies.

And Schroders' regular inflows over the previous year have been disrupted by its greatest net outflow in two years, with £270 million leaving the asset manager, including £73 million from the Schroders Emerging Markets strategy.



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