Amundi reports that 2022 came as the fifth best year for ETFs on record flow-wise in Europe, with assets under management now standing at EUR1.24 trillion. ETFs have enjoyed a 17 per cent annual growth over the last decade, the firm says.
Investors looked for directions to reposition their portfolios over the year, suffering from significant losses coming from both their Equity and Fixed Income allocation, the firm writes.
Equities: +EUR51.4 billion
There was significant traction for World and US exposures at the expense of Europe which experienced significant outflows.
EM gathered steady flows month after month. China remained on top of investors’ agenda.
Alternative Energy and Cyber Security exposures gained traction with significant inflows into Thematic ETFs as a result.
Fixed Income: +EUR31.6 billion
It has been a challenging year for Fixed Income investors, which faced losses in the market downturn, Amundi writes.
Fixed Income investors continuously adjusted their risk exposure as a result.
In Q2, investors initially scouted for short-dated bonds exposures such as short-term credit ETFs to adjust their duration risk in a context of higher rates. As the year progressed along with central banks’ tightening cycle, appetite for longer duration exposures increased.
Government bonds (predominantly EUR and USD) and Investment Grade Corporate bonds were the most favoured segments.
EM Debt saw significant outflows, especially on CNY denominated bonds.
Strong appetite for ESG confirmed
In 2022, ESG ETFs recorded EUR52.7 billion inflows, mainly directed into Climate and Broad ESG.
The lion share went into ESG Fixed Income ETFs that attracted 66 per cent of total Fixed Income flows (EUR20.8 billion NNAs of EUR31.6 billion).