Amundi’s October figures show ETF flows down for the month

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Amundi’s latest ETF flows covering the month of October reveals that concerns over the US election and the second wave of Covid-19 in Europe reduced global ETF in-flows in October to EUR42.7 billion from EUR48.6 billion in the previous month.

Investors allocated EUR17.4 billion to equities, almost 50 per cent lower than September inflows of EUR33 billion, and EUR25.4 billion to debt.

Amundi writes that while the global flows favour fixed income, European registered ETFs maintained the recent trend of fixed income flows being lower than allocations to equities with European-registered funds gaining EUR1.7 billion.

Concerns over the economic outlook for Europe resulted in outflows from both investment-grade and high-yield Eurozone corporate ETFs of EUR1.15 billion and EUR439 million. Total outflows from corporate debt strategies were EUR1.41 billion reflecting worries about the European economic outlook as well some investors taking profits, Amundi says.

Confidence in Asia’s ability to bounce back more quickly from Covid than Europe saw investors allocate EUR778 million to Chinese and EUR592 million to emerging market government fixed income funds, according to the report. Total inflows to government bonds were EUR2.74 billion in October.

In terms of equities, European-registered equities gained EUR2.6 billion this month. Pre-election jitters caused investors to withdraw EUR1.3 billion from North American strategies while worries about the rapid increase in Covid saw a reduction of EUR296 million from eurozone strategies, Amundi writes.

In contrast, Asia’s ability to control the virus boosted investor confidence in emerging markets and China with ETFs focused on these regions picking up assets of EUR554 million and EUR413 million respectively, according to the report.

Investors returned to the similar strategies they used during the first lockdown – allocating EUR531 million to the healthcare sector. The return to working-from-home also spurred investors to withdraw funds from real estate and smart city strategies – losing EUR30 million and EUR16 million. Year-to-date real estate withdrawals have now reached EUR543 million, the firm writes.

Over the last 10 months, both sector and ESG equity strategies have proved popular while investors have spurned the ETFs tracking the main indices as well as smart beta ETFs. Year-to-date inflows for ESG ETFs have been EUR22.9 billion while sector ETFs have gained EUR15.4 billion. Smart beta outflows were almost -EUR7 billion and, despite inflows over the summer, the main indices remain at approximately -EUR6 billion over the year.

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