Philip Philippides Amundi ETF

ETF Market Flows Analysis Europe and World – June 2018

The first half of 2018 saw the global ETF market collect more than 188 billion euros, the vast majority of these in equity ETFs (more than 125 billion)….

Philip Philippides, Head of Amundi ETF & Indexing Sales for UK and Ireland

Flows slowed in June to 5.5 billion euros, of which slightly under one billion went into the European market.

The ETF market closed the first half of 2018 with a contrasting month in June across its three main geographical areas. While in Asia, inflows remained dynamic at €6.2 billion, they were lower in Europe (+0.98 billion) and even more so in the United States (-1.6 billion).

Worldwide, the global ETF market gained 5.5 billion net subscriptions over the past month, totalling more than 188 billion since the beginning of the year.

US equities preferred

In the European market specifically, equity ETFs suffered from 235 million euros of withdrawals in June.

As in previous months, European investors continued to favour North American equities (+€2 billion), global equity ETFs (+576 million) and even European equity ETFs (+726 million), at the expense of Eurozone (-824 million), Japanese (-1.29 billion) and emerging market ETFs (-1.54 billion).

Among Smart Beta ETFs, multi-factor approaches continued to prove attractive (+114 million), though investors reduced their exposure to the value strategy (-381 million).

Floating Rate Notes seduce

As far as fixed income ETFs are concerned, there is a waitand-see attitude in Europe: they only managed to attain 998 million euros of net subscriptions in June.

European investors continued to show their reluctance to return to corporate bonds, with only €35 million of net inflows, explained by the good performance of floating rate notes (+197 million), against withdrawals from Eurozone corporate bonds (investment grade and high yield).

Arbitrage in favour of sovereign bonds was limited to +769 million, with a more marked interest in the US market (particularly through inflation-linked bonds).

Source: ETFWorld

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