European investors seek safety in money market funds

Money market funds were the top-selling investment vehicles in March, with European investors contributing €34.1 billion to these funds, according to data from Refinitiv Lipper. This surge in demand for money market funds helped boost overall flows for mutual funds and ETFs in Europe, resulting in net inflows of €11 billion for the month.  

Money market funds were the top-selling investment vehicles in March, with European investors contributing €34.1 billion to these funds, according to data from Refinitiv Lipper. This surge in demand for money market funds helped boost overall flows for mutual funds and ETFs in Europe, resulting in net inflows of €11 billion for the month. 

However, actively managed mutual funds experienced outflows of €23.1 billion, primarily driven by redemptions from mixed asset and equity strategies. 

Despite the positive economic outlook and the potential end of interest rate hikes by central banks, European investors seem to remain cautious, as indicated by the preference for money market funds and the outflows from long-term funds. Detlef Glow, head of EMEA research at Refinitiv Lipper, highlighted the surprising sell-off of mixed-asset products, which have historically been favored by European investors in various market conditions. 

Following money market funds, bond funds attracted the most significant inflows of €1.6 billion, while “other” funds and real estate funds recorded inflows of €1.1 billion and €700 million, respectively. On the other hand, mixed asset strategies experienced outflows of €13.7 billion, making it the worst-selling category, followed by alternative funds and equity funds with redemptions of €6.7 billion and €6 billion, respectively. 

In terms of fund promoters, BlackRock emerged as the top-selling company in March, generating sales of €21.9 billion. Swisscanto and Goldman Sachs followed closely with sales of €6.9 billion and €6.2 billion, respectively. Glow noted that the strong demand for money market funds played a significant role in the success of BlackRock, Goldman Sachs, and BNP Paribas during the month. Read more: https://www.funds-europe.com/news/risk-off-european-investors-pile-into-money-market-funds