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European equity flows catch up with US stocks

European equity funds saw a second consecutive month of net inflows, welcoming a net amount of €2.5bn in January, while US equities saw positive inflows of €2.4bn.

Some analysts expect 2017 to be the year active managers bounce back because of changes in the investment environment. “There is a big decorrelation going on, and there are a lot of sector-specific trends active managers can profit from,” said Kevin Gaynor, head of research at Nomura, at a panel discussion in London earlier this week.

Passive rules

European investors don’t seem entirely convinced though, and seem to stick to beta returns for now. Actively managed European equity funds saw net outflows, with the exception of value funds, with investors continuing to prefer passive options.

Expert Investor reported earlier that even European small cap ETFs, normally the domain of active managers, had seen a strong uptick in interest recently.

Net inflows into actively managed US equity funds were positive in January at €330m, but flows into ETFs accounted for the bulk of the flows to the asset class.

Part of the Bonhill Group.