New research published by Rainmaker Information has revealed that Australia’s managed fund industry experienced estimated net flows of $16 billion in the 2022 financial year.
The firm’s latest Managed Funds Net Flows report indicated that funds under management (FUM) through net flows lifted by 2.3 per cent over the period; however, the total managed funds market was found to have decreased by 4.3 per cent or $29 billion to $652 billion.
Australian equities large cap had the highest net flows out of all asset classes at $6 billion with $102 billion in FUM, an increase of 6 per cent through flows.
This was followed by bonds with credit and high yield characteristics, with $5.7 billion in inflows and FUM of $48 billion, representing an increase of 13 per cent through flows.
Diversified products were next with net flows of $4 billion and FUM of $62 billion.
On the other end of the spectrum, alternatives suffered the largest decrease in percentage terms of 7 per cent, equivalent to $922 million, while international equities large cap experienced the largest overall net outflows of $3.2 billion or around 2 per cent of FUM.
“Measuring net flows allows us to see how the market is reacting across asset classes, products or even across investment managers, without having investment performance skew how we are perceiving demand,” said Rainmaker Information head of investment research, John Dyall.
“We have found that net flows trail performance by 12 months, so leading performance will experience inflows from investors 12 months later and the same goes for poor performers experiencing outflows.”
Rainmaker reported that, of the 154 managers in its database, 92 experienced net inflows and 62 experienced net outflows in the 12 months to 30 June 2022.
Vanguard had the highest net inflows of $10.4 billion, an increase of 8 per cent from flows, ahead of BetaShares with $4.6 billion, up by 26 per cent.
Eiger Capital recorded the largest percentage increase in net flows out of the top 40 managers at 556 per cent, followed by Airlie Funds Management with 366 per cent.
The single product with the highest net inflow was the Dexus Wholesale Property Fund at $3.3 billion, which Mr Dyall explained was primarily due to the merger between it and the AMP Capital Diversified Property Fund.
Meanwhile, the Vanguard Australian Shares Index ETF (VAS) had the second highest inflow of $2.4 billion with an increase of 27 per cent.
“Interestingly, this was five times the size of net inflows into the unit trust version of this product, the Vanguard Australian Shares Index Fund, which had inflows of $471 million,” said Mr Dyall.
“That fund is $15.9 billion in size, while the ETF is $10.4 billion in size.”
According to the latest BetaShares Australian ETF Review, VAS also had the second highest inflows out of all ETFs during the month of August at $115.4 million.
