ASSET FLOWS REPORT. First Quarter 2016

Transcription

1 ASSET FLOWS REPORT First Quarter 2016

2 About the evestment Asset Flows Report Asset Flows Report This report is intended to show the flow of institutional funds across regions, universes and products. We welcome all questions, comments and feedback: The methodology for calculating flows is in the appendix of this document. All flow data is calculated based on a bottom-up approach. Flows are calculated for each product and summarized at the universe and asset class levels. The universes that are used for the flows in this report are identical to the universes and classifications that exist within the evestment database. About evestment evestment provides a flexible suite of easy-touse, cloud-based solutions to help global investors and their consultants select investment managers, enable asset managers to successfully market their funds worldwide and assist clients to identify and capitalize on global investment trends. With the largest, most comprehensive global database of traditional and alternative strategies, delivered through leading-edge technology and backed by fantastic client service, evestment helps its clients be more strategic, efficient and informed. 2

3 Executive Summary The institutional asset management industry reported net outflows totaling $95.4 billion in 1Q 2016 after outflows of $137.1 billion in the fourth quarter of Industry wide outflows are evidence of investors seeking opportunities in alternative investments or holding onto cash. Following outflows of $19.7 billion during the fourth quarter, fixed income products reported outflows totaling $26.7 billion. Equity strategies reported net outflows of $58.6 billion, marking the 12th consecutive quarter of net outflows for the asset class. Balanced/multi-asset products recorded net outflows totaling $10.1 billion during the first quarter after recording outflows of $5.5 billion in 4Q First quarter outflows from fixed income markets were driven by global bonds, which reported net outflows of $17.4 billion following inflows of $20.0 billion in the previous quarter. After inflows of $4.1 billion in the fourth quarter, US bonds saw net inflows increase to $8.1 billion at the beginning of Investors continue to redeem assets from emerging markets debt. Over the last four quarters, net flows from the evestment Emerging Markets Fixed Income universe totaled $38.5 billion. Domestic and global stocks reported significant investor outflows in 1Q US equity reported outflows of $35.7 billion, while global stocks recorded outflows of $5.2 billion. Passively managed equity, both US and non-us, continued to attract institutional assets in 1Q As a whole, passively managed equities reported inflows of $11.9 billion, while actively managed equities reported net outflows of $70.5 billion. Despite a 7% increase in AUM from the fourth quarter, multi-asset strategies have now seen two consecutive quarters of net outflows, following inflows of $21.5 billion in Corporate pensions have withdrawn $6.3 billion from multi-asset strategies over the last two quarters. International equities continue to attract the attention of institutional investors both in terms of database search activity and resulting asset flows. The evestment EAFE Equity universe reported inflows of $17.7 billion, while the evestment ACWI ex-us Equity universe reported inflows of $5.0 billion. US passive fixed income reported inflows of $13.0 billion in 1Q 2016, which represents an increase of 2.6% compared to 4Q 2015 AUM. Institutional AUM in US passive fixed income has increased more than 8% since the first quarter of Investors continue to move into passively managed strategies. Passive strategies reported net inflows of $25.7 billion in 1Q 2016, while actively managed strategies reported net outflows of $131.4 billion in the same period. After a period of significantly decreased search activity in the evestment database, global unconstrained bonds reported net outflows of $1.6 billion in the first quarter. First quarter outflows come on the heels of $29.5 billion flowing into the asset class in ESG-focused strategies, specifically fossil fuel free investments, have been attracting a lot of search activity in the evestment database in recent quarters. Strategies that fit this criteria reported inflows of $4.0 billion in the first quarter. Insurance companies and corporate pensions were the largest buyers of these strategies in 1Q Emerging markets equities reported net outflows for the fourth consecutive quarter. Outflows from the universe over the last year have totaled $30.0 billion. Despite outflows, investors in Europe ex-uk have allocated an additional $2.3 billion to emerging markets equities since 2Q

4 Executive Summary - Flows by Account Domicile United States: US domiciled accounts reported $111.1 billion in outflows. Outflows were once again driven by redemptions from US equity strategies. US domiciled accounts redeemed $64.6 billion from US equities, and US bonds reported outflows of $19.1 billion. EAFE equities saw the largest inflows during the first quarter reporting inflows of $7.1 billion following outflows of $5.3 billion in the fourth quarter. Europe ex-uk: Investors in Europe ex-uk were net sellers in 1Q 2016 with outflows totaling $22.2 billion. Outflows were led by $9.9 billion redeemed from global fixed income, $5.1 billion from US equity, and $3.1 billion from Asia Pacific Equity. United Kingdom: UK domiciled investors were net sellers during 1Q 2016 with outflows of $26.0 billion. Outflows from UK domiciled investors were led by $6.4 billion redeemed from UK equity. UK investors favored global equities in the first quarter, leading to inflows of $1.7 billion. Canada: Canadian domiciled investors reported outflows of $2.3 billion during 1Q Outflows were led by $3.1 billion from Canadian Balanced funds. Global Fixed income saw the largest inflows in the first quarter with $2.1 billion, following inflows of $866 million in the fourth quarter. Africa/Middle East: Investors domiciled in Africa and the Middle East were net sellers during 1Q 2016 with net outflows totaling $17.4 billion. Redemptions were led by $5.7 billion in net outflows from US bonds. Australia: Australian domiciled investors recorded net outflows of $3.0 billion in the first quarter after inflows of $1.1 billion in 4Q Outflows from Australian investors were driven by $3.1 billion redeemed from Australian equities. Japan: Japanese investors were net buyers in the first quarter of 2016 with net inflows of $26.7 billion, following inflows of $29.3 billion in 4Q As in all four quarters of 2015, US bonds were the recipient of the largest flows from Japanese investors. US bonds reported inflows of $10.5 billion in the first quarter of Asia ex-japan: Asia ex-japan investors had net outflows of $3.7 billion in 1Q Emerging markets bonds reported outflows of $4.0 billion in the first quarter, while global equities led inflows with $1.7 billion. Hong Kong: Hong Kong domiciled investors reported net outflows of $6.9 billion in 1Q Following outflows in 4Q 2015, investors in Hong Kong reported outflows from US equity totaling $6.9 billion. Latin America: Investors domiciled in Latin America reported inflows of $1.5 billion in the first quarter. Inflows were led by $1.9 billion flowing into US bonds in 1Q Singapore: Investors domiciled in Singapore reported outflows of $138 million during 1Q 2016 after inflows of $290 million in the fourth quarter. Outflows were led by $1.0 billion flowing out of Asia Pacific equities in the first quarter, following outflows of $386 million in the fourth quarter. 4

5 Executive Summary Flows by Account Type Corporate: Corporate accounts had net outflows of $32.7 billion in the first quarter following outflows of $36.6 billion in 4Q Outflows were led by $10.7 billion flowing out of US equities and $4.8 billion flowing out of the evestment Global Balanced/TAA universe. Corporate pensions also shifted positions on European bonds resulting in net inflows of $2.9 billion. Public Funds: Public funds had net outflows of $13.7 billion during 1Q 2016, following outflows of $29.6 billion during the fourth quarter. Outflows were driven by US equities with net outflows of $12.7 billion. After inflows in the fourth quarter, US bonds reported outflows of $6.0 billion in 1Q Global equities received the largest inflows from public funds reporting inflows of $3.5 billion. Insurance: Insurance accounts had net inflows of $1.0 billion in the first quarter after outflows of $16.1 billion in 4Q Inflows were driven by global equities and bonds. Global equities reported inflows of $1.8 billion and global fixed income reported inflows of $1.4 billion during 1Q Defined Contribution: DC plans recorded net inflows of $3.5 billion in the first quarter of Inflows from DC plans were led by $4.5 billion flowing into US bonds in 1Q DC plans shifted positions in the evestment Global Balanced/TAA universe resulting in net outflows of $1.4 billion. Foundations and Endowments: Foundations and endowments were net sellers in 1Q 2016 with outflows of $5.5 billion. Foundations and endowments continue to be net sellers of EAFE equities, resulting in net outflows of $2.1 billion in 1Q Union/Multi-Employer: Union/multi-employer accounts recorded net outflows of $5.2 billion in 1Q Union/multi-employer accounts were sellers of US bonds during 1Q 2016, with net outflows of $2.2 billion, following outflows of $4.6 billion in 4Q Sovereign Wealth Funds: Sovereign wealth funds were net sellers in 1Q 2016 with outflows of $8.8 billion following outflows of $8.9 billion in the fourth quarter. Redemptions were led by $2.7 billion in net outflows from Japanese equities, which had net inflows of $906 million in the fourth quarter. Health Care: Health care accounts recorded outflows of $1.1 billion during 1Q 2016, following outflows of $650 million in the fourth quarter. Outflows were led by $374 million redeemed from global equities in the first quarter, followed by ACWI ex-us equities with $238 million in outflows. 5

6 LOCATIONS Atlanta London 5000 Olde Towne Parkway 2 nd Floor Suite Fenchurch Street Marietta, Georgia London EC3M 4AD United States United Kingdom +1 (877) (0) support@evestment.com europe@evestment.com New York Sydney 58 W. 40 th Street Level 26 4 th Floor 1 Bligh Street New York, New York, Sydney NWS 2000 Unites States Australia +1 (212) (0) support@evestment.com australia@evestment.com Dubai Hong Kong Executive Office 02 Level 18 Building 01 Wheelock House Dubai Internet City, Dubai 20 Pedder Street United Arab Emirates Central, Hong Kong support@evestment.com asia@evestment.com MEDIA CONTACTS Mark Scott William Obre evestment Corporate Communications Kwittken (US) mscott@evestment.com wobre@kwittken.com +1 (678) (646) Tamir Abdel-Wahab Jamie Waddell Ryan Communications (Asia) Kwittken (UK) tamir@ryancommunications.com jwaddell@kwittken.com Disclaimer The data included in this report are a compilation of performance data provided by evestment unless otherwise noted. This report should not be considered to be investment advice and is not a recommendation, endorsement, or solicitation for any investment manager or its services or of any securities referred to herein. All quarterly returns are provided directly by the manager of the product shown. While the information contained herein has been obtained from sources deemed reliable, evestment nor any information provider guarantee that it is accurate or complete or make any warranties with regard to the results that have or may be obtained from its use. evestment Alliance has not made any independent attempt to confirm the accuracy of the data used in the preparation of this publication. Past performance is not an indication of future performance. 6