A Global Bond Boom Is Under Way

European investors sent EUR 37 billion in new money to bond funds in the first quarter of 2012

Dan Lefkovitz 30 April, 2012 | 9:54PM

The European funds industry enjoyed a solid March and a strong first quarter of 2012, which is unsurprising given buoyant markets and a (relatively) quiet period in the ongoing eurozone debt saga. Investors sent more than EUR 16 billion of new money to long-term funds in March, pushing their quarterly intake above EUR 50 billion. Meanwhile, money market funds attracted more than EUR 10 billion in March to finish the first quarter EUR 5.5 billion in the black. European funds will need more strong quarters to claw back their outflows of 2011.

At the asset class level, the picture is mixed. After two months of modest inflows, equity funds saw EUR 1.3 billion worth of net redemptions in March. Meanwhile, European investors sent nearly EUR 14 billion of new money to fixed income, bringing the quarterly total to EUR 37 billion for bond funds.

Allocation funds also shined, bringing in more than EUR 3 billion in March and nearly EUR 7 billion for the first quarter.

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About Author

Dan Lefkovitz

Dan Lefkovitz  is strategist for Morningstar’s Indexes group

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