The 2021 Fact Book provides an in-depth analysis of trends in the European fund industry, an extensive overview of the regulatory developments across 29 European countries and a wealth of data.
New to this year’s
edition is an analysis of the impact of the Covid-19 pandemic on the
industry, an overview of the growth of ESG UCITS since 2016, a deep dive
into the fund holdings of insurers, performance and costs figures for
both active and passive UCITS and a focus on household financial assets.
Key findings include:
- Net sales of UCITS in 2020 –
Net outflows from UCITS amounted to EUR 314 billion in March, the
largest monthly outflows ever observed in absolute terms. Investor
confidence returned in April and net sales remained strong during the
following months, resulting in a total of EUR 474 billion of net sales
over the year. Broken down by fund type, 2020 has been marked by record-breaking net sales of money market funds (MMFs) and strong net inflows into equity funds.
- Net sales of AIFs in 2020 –
Net inflows into AIFs were hardly impacted by the pandemic, they stayed
positive in March and only turned slightly negative in April. The
resilience of AIFs amid the Covid-19 pandemic confirms the longer-term
investment horizon of insurers and pension funds who are the primary
investors in AIFs.
- ESG UCITS – Net
assets of European ESG UCITS funds have grown strongly in the last five
years, with more significant increases in 2019 and 2020. The share of
ESG funds grew from almost 7% of total net assets in 2015 to 11% in
2020, or EUR 1.2 trillion. This
growth was supported by an exponential rise of net sales of ESG UCITS
in 2020, to an estimated total of EUR 235 billion, despite the Covid-19
pandemic.
EFAMA’s Director General, Tanguy van de Werve commented:
“2020 was
undeniably marked by the Covid-19 pandemic. Despite the enormous
economic damages, investors inside and outside Europe continued to put
their trust in UCITS and AIFs and boosted net sales to EUR 650 billion.
ESG funds attracted more than one-third of these net sales. We are
confident this upwards ESG trend will continue, especially if
policy-makers take the necessary actions to fill the existing ESG data
gap.”
Other key findings include:
- Investor demographics - Insurers and pension funds are by far the largest investors.
At the end of 2020, they held 41% of the UCITS and AIF net assets owned
by European investors. Households came second, with a market share of
25%. Other financial intermediaries, which are mainly long-term
investment funds, followed closely, with 24%.
- Domestic markets - The
countries with the highest levels of fund ownership at the end of 2020
were Germany, the UK, France, the Netherlands and Italy. Reflecting
the size of their economies and populations, the four largest European
countries feature in this top five. The Netherlands takes fourth place
in terms of fund ownership, thanks to the size of Dutch occupational
pension funds, which tend to invest a significant share of their
portfolios into investment funds.
- Fund domiciles - At
the end of 2020, 78% of the net assets of UCITS and AIFs were domiciled
in only five countries. Luxembourg and Ireland are the two largest
domiciles, due to their status as the main cross-border fund hubs. The
large shares of Germany, France and the United Kingdom can be explained
by the relative size of their economies and domestic fund markets.
- Fees - The
cost of UCITS has been steadily declining across Europe in recent
years. The costs of actively managed equity and bond funds decreased by
11% and 18%, respectively, between 2016 and 2020. This trend is expected
to go on in the future due to increased transparency around fees and
continuing pressure from passive funds.
- Worldwide net sales
- Net sales of funds worldwide rose in 2020 to the second-highest level
of the decade. Net inflows into money market funds represented more
than half of the total 2020 net inflows: an absolute record. Net sales
of equity funds remained low, despite strong net inflows recorded in
Europe. This was mainly due to net outflows in the United States, which
can be partly explained by US investors rebalancing their portfolios by
selling equity funds and buying bond funds.
EFAMA
© EFAMA - European Fund and Asset Management Association
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