Across Asia, Europe and Cross-Border markets, long-term funds launched during 3Q’17 garnered US$67.4 billion in net new investor money. Though net subscriptions into Asian products increased compared to 2Q’17, they still fell short of their 1Q’17 result of over $60 billion. Nonetheless, the region led product development as its 957 new funds attracted higher net flows than local Europe and Cross-border products combined.
With US$21 billion in net inflows spread across 218 new funds, China was once again the highest inflow market of the quarter when it comes to new products. The 50% increase in net subscriptions compared to 2Q’17 can largely be attributed to a renewed interest for new Bond CNY and flexible asset allocation funds, which collectively attracted US$17.2 billion.
In 3Q’17, new fund flows in Japan reached US$4.1 billion, nearly a quarter of which was garnered by a single fund launched by Amundi. Whereas net deposits into new equity products fell by 58% from 2Q’17, all other asset classes experienced a rise in demand. For instance, net subscriptions into bond funds more than doubled and those into mixed funds more than quadrupled.
Although new investor money deposited into long-term local European funds has remained relatively stable so far this year, net subscriptions into cross-border products declined every quarter during 2017 and stood at $10.3 billion in 3Q.
During 3Q’17, US$21.9 billion was deposited into new local European long-term funds, exceeding the US$21.4 billion collected during 2Q’17, despite a 30% decrease in the number of funds launched. For the second consecutive quarter, mixed funds (US$8.2 billion) outsold their bond counterparts (US$6.2 billion), which were followed by equity funds with US$5.1 billion in net new flows.
Italy has led product development in Europe every quarter this year. Its 55 newly launched funds, the highest number of launches during 3Q’17, gathered US$9.3 billion in net new cash. The U.K. followed with 34 new launches attracting US$7.3 billion in net flows, over half of which was garnered by the four products rolled out by BlackRock and Baillie Gifford in the quarter.