New Funds in Global Markets 1Q 2017 - Asia, Local Europe, and Cross-Border

Nearly US$98 billion was invested into 1,561 newly launched long-term funds across Asia, Europe and Cross-border markets during 1Q’17. Asia continued to dominate new product development although net flows recorded in the region declined over the quarter, while new money deposited into local European new funds increased steadily. Products launched in local Europe gathered close to 27% of the quarter’s total new fund flows.

In Asia, long-term product sales amounted to nearly $60 billion through 989 new launches during 1Q’17. Despite a 26% drop in net flows recorded among Chinese funds, China still dominated product development, attracting 69% of the region’s total new fund sales. This drastic slow-down allowed numerous other Asian countries to significantly increase their share of the market.

ICBC Credit Suisse, the joint venture between China’s largest bank ICBC and the Swiss bank and wealth manager Credit Suisse, became the best-selling asset manager of 1Q’17. The firm primarily benefited from the success of ICBCCS FengChun 6 Months Open Bond Fund, which attracted an incredible amount of US$13.2 billion in just three days, an all-time record high among public fund IPOs in China.

Thematic investment strategies have remained popular among Japanese investors. In addition to artificial intelligence and robo-technology, the result of the U.S. presidential election appears to have driven investors to capitalize on infrastructure and policy-related investment in the U.S.

211 newly launched Cross-border funds attracted nearly US$12 billion in fund sales during 1Q’17. Similarly as throughout 2016, bond fund outperformed all other fund types, garnering US$5.7 billion across 60 new products. Mixed funds, which collected US$1.5 billion in new cash, were outsold by ‘Other’ products, which garnered US$3.4 billion in net subscriptions with only 46 launches. Net flows into new equity products dropped 73%, from US$4.3 billion in 4Q’16 to $1.2 billion in 1Q’17. At the category level, Alternative investment products attracted the largest influx of investor money with US$1.9 billion across 41 new funds, the highest number of new launches within a single category.

Local Europe long-term funds launched during 1Q’17 gathered over US$26 billion in net subscriptions, recovering from their relatively low 3Q and 4Q’16 results. Including preexisting funds, products from European markets recorded more than US$77 billion in net flows, a very promising figure, compared to the US$125 billion collected throughout the full year of 2016.