Capital Preservation Trumps Return Maximisation

Asset flows to European funds in Q2 continue to show a thirst for preserving capital rather than maximising returns

Dan Lefkovitz 26 July, 2012 | 10:53AM

Asset flows to European funds continue to react predictably to the ongoing eurozone crisis and its attendant market turbulence. The liquidity-fuelled market rally of 2012’s first quarter lifted investor confidence and attracted money into funds. Then, with instability in Europe, as well as bad news from the US and China sending markets into fits, European investors withdrew €4.2 billion from long-term funds in the second quarter; June saw €1.2 billion worth of net redemptions from long-term funds.

Money market funds cushioned the blow for the European funds industry in the second quarter.

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About Author

Dan Lefkovitz

Dan Lefkovitz  is director of fund research operations, Europe and Asia, Morningstar.

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