Fund Investors Getting More Positive On Stocks

Equity funds were back on investors' shopping lists last month for the first time since February, but bonds remain the favourite for 2012

Ali Masarwah 25 October, 2012 | 10:00AM

With policymakers and central banks striving to ease the pain for troubled eurozone economies, European fund investors may be shrugging off the risk of euro implosion. Morningstar asset flow data for September suggests that investors are increasing their exposure to risky assets, and not just in the bond space. In September, equity funds received net inflows of EUR 1.91 billion, their first positive month since February. This ends a long period of disconnect between fund investor behaviour and equity market performance. 

Bond Funds Still Top of the Shopping List…
Flows to equity funds still pale in comparison to investor enthusiasm for bond funds. Investors poured another EUR 15.9 billion into fixed-income funds in September. With net inflows of EUR 53.24 billion, the third quarter of 2012 saw the highest quarterly inflow into bond funds in any quarter on record (Morningstar’s European asset flows data extends back to 2007). 

Allocation funds saw healthy net inflows of EUR 2.6 billion in September, bringing third quarter’s total to EUR 6.23 billion. 

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About Author

Ali Masarwah

Ali Masarwah  is the editor of Morningstar.de in Germany.

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