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EM Flows Weekly_ A lump of coal_ EM bond outflows persist during the holidays. Fri Dec 27 2024
Dezan Shira & Associates·2024-12-30 07:22

Summary of Key Points from the Conference Call Industry Overview - The report focuses on Emerging Markets (EM) bond and equity fund flows, particularly highlighting trends in retail bond funds and equity funds in the EM sector [68][80]. Core Insights and Arguments - Cumulative Fund Flows: Since 2004, cumulative EM retail bond fund flows are +227billion,with+227 billion, with +143 billion to hard currency and +85billiontolocalcurrency.CumulativeEMretailequityfundflowsare+85 billion to local currency. Cumulative EM retail equity fund flows are +313 billion, with +322billiontoGEMfundsand−322 billion to GEM funds and -8 billion to regional funds [46]. - Recent Fund Flows: - EM bond flows were -1.7billionthisweek,withhardcurrencyfundoutflowsacceleratingto−1.7 billion this week, with hard currency fund outflows accelerating to -1.5 billion and local currency fund outflows declining to -184million.−EMequityflowswere−184 million. - EM equity flows were -996 million, a significant decrease from -4.6billionthepreviousweek[80].−∗∗ETFvs.Non−ETFFlows∗∗:ETFoutflowsforEMbondsacceleratedto−4.6 billion the previous week [80]. - **ETF vs. Non-ETF Flows**: ETF outflows for EM bonds accelerated to -1.1 billion, while non-ETF outflows fell to -606million.ForEMequity,ETFoutflowswere−606 million. For EM equity, ETF outflows were -512 million and non-ETF outflows were -483million[80].−∗∗RegionalPerformance∗∗:Amongregionalfunds,Asiaex−Japansawunchangedoutflowsat−483 million [80]. - **Regional Performance**: Among regional funds, Asia ex-Japan saw unchanged outflows at -1.5 billion, while EMEA had inflows of +61millionandLatAmhadoutflowsof−61 million and LatAm had outflows of -243 million [80]. Important but Overlooked Content - Non-Resident EM Portfolio Flows: There were net foreign outflows from EM local bonds, particularly from Hungary (-704million),andfromEMequities,mainlyfromTaiwan(−704 million), and from EM equities, mainly from Taiwan (-1.0 billion) [80]. - Year-to-Date Flows: Year-to-date flows to EM bonds and equities stand at -29.9billionand−29.9 billion and -31.3 billion, respectively, indicating a challenging environment for both asset classes [80]. - Cumulative EM Retail Bond Fund Flows: The report indicates that cumulative EM retail bond fund flows have been negative in recent weeks, reflecting broader market trends and investor sentiment [80]. Data Highlights - Weekly EM Retail Equity Fund Flows: The report shows a significant drop in retail equity fund flows, with a 4-week average of -2,169 million [2]. - Cumulative EM Bond Fund Flows: The cumulative flows for EM bond funds show a stark contrast between retail and strategic flows, with retail flows being more volatile [18]. This summary encapsulates the key points from the conference call, providing insights into the current state of the EM bond and equity markets, along with specific data that highlights trends and investor behavior.