Some call is a market crisis. Others say there is ferocious competition for deposits. And some blame liquidity shortages on investors. Whatever the reason is, what is true is that Spanish funds are not going through their golden years. In fact, according to the latest data published by Inverco, 76% of funds managed by national companies have amassed more withdrawals than deposits this year. That is, for three out of four products, money is being divesting instead of invested.
That would explain how the industry has already amassed net withdrawals of some 5.7 billion euros through September. This figure is worrisome, but far from the 16 billion euros taken out of accounts during the same period in 2010 and the 50 billion in 2009 after Lehman fell.
The reason funds have not gushed out faster is that guaranteed funds are having some success. More specifically, those that are investing in fixed income. Not in vain, one in three new products that have been introduced to the markets fall into this category and perhaps that explains why the majority of funds that are taking in deposits belong to this group. "These products are really easy to fund in distribution networks, especially at a time when the people are demanding security and the industry is facing challenges in finding resources," affirmed Victoria Torre, financial products analyst from Self Bank.
Judging by the data, it seems that the fixed income strategy is working out well for investment managers. Working so well that through September, fixed income funds are the only ones to take in copious amounts of investor capital. They have captured no less than 6.539 billion euros.
