Posted inAbsolute ReturnAlternatives

Alternative funds will outsize fixed income by the end of 2016, if trend continues

Net flows into alternative investment funds (excluding property) grew by 17.4% through 2015. Total assets worldwide now amount to $122bn, just a fraction below the $132bn amassed in fixed income funds. So with current growth rates, assets invested in alternatives will surpass those in bond funds for the first time by the end of this year.   

US equities lose shine

QE-fuelled European and Japanese equities were also in strong demand globally, while US equities saw sizeable net outflows of $52bn for US large caps funds alone. European large cap equity funds were the second most popular category after global equities, with net inflows growing by 23.3% to $126bn. Japanese equity flows grew even slightly faster, at 23.5%, to $64bn.

 

But America still rules

Pimco was the worst performer of the large asset managers, with $86bn of net outflows. Overall, asset management remains an American affair, with the 10 biggest asset managers in terms of AuM all headquartered in the US.  

The bulk of the net inflows went to passive funds, so little surprise that Vanguard and Blackrock were responsible for the majority of net inflows worldwide between them. While Vanguard saw $251bn in net inflows, Blackrock welcomed $150bn in net new money.

Part of the Bonhill Group.