Refinitiv: August 2021 marked the seventeenth consecutive month with inflows into ETFs after the outflows caused by the outbreak of the COVID-19 pandemic in March 2020.
By Detlef Glow, Lipper’s head of EMEA research at Refinitiv
These inflows occurred in a positive but somewhat volatile market environment in which investor sentiment was still impacted by the dynamics of the COVID-19 pandemic on the economies around the globe and the resulting actions taken by central banks and governments in Europe and other parts of the world.
The positive performance of the underlying markets led in combination with the estimated net inflows to increasing assets under management (from €1,197.5 bn as of July 31, 2021, to €1,231.2 bn at the end of August). The increase of €33.7 bn for August was driven by the performance of the underlying markets (+€23.9 bn), while the estimated net sales contributed €9.8 bn to the increase of assets under management. With regard to assets under management, it was not surprising equity funds (€891.3 bn) held the majority of assets, followed by bond funds (€298.6 bn), commodities products (€29.3 bn), alternative UCITS products (€6.6 bn), mixed-assets funds (€2.8 bn), money market funds (€2.6 bn), and “other” funds (€0.1 bn).
Graph 1: Market Share, Assets Under Management in the European ETF Segment by Asset Type, August 31, 2021
Source: Refinitiv Lipper
Fund Flows by Asset Type
The European ETF industry enjoyed healthy estimated net inflows for August (+€9.8 bn) which were below the rolling 12-month average (€13.8 bn). In fact, the flows for August 2021 were the lowest inflows into ETFs in Europe since October 2020.
The inflows in the European ETF industry for August were driven by equity ETFs (+€6.2 bn), followed by bond ETFs (+€3.2 bn), money market ETFs (+€0.2 bn), and mixed-assets ETFs (+€0.1 bn). Meanwhile, “other” ETFs (-€0.01 bn) and commodities ETFs (-€0.03 bn) showed outflows for the month.
This flow pattern drove the estimated overall net inflows to €9.8 bn for the month and €113.9 bn for 2021 so far. The flows for the first eight months of 2021 have already topped the level of flows for the former record year 2019 and are set to reach a new all-time high at the end of the year.