Where The Money Is Going: Global Fund Flows Heatmap
Curious where the global money has been flowing in the past quarter? Then the following Deutsche Bank global heatmap showing the 3-month flows into equity funds (including ETFs) should help answer that question.
Some more detailed observations from DB on the main catalyst behind global asset flows in the past few months.
The ECB's QE helps sustain the inflow momentum for European mandates across asset classes. The ECB’s QE has started this week and triggered 2-yr high weekly inflows for European sovereign and credit bond funds, thereby dragging 10-yr Bunds lower to an all-time record low of 0.2% (mid-week). This lower benchmark rate forced fwd equity multiples higher and put the SXXP index level (395.5) in reach of its all-time highs seen in Mar’00 (405.5) and Jun’07 (400.3), backed by another week of strong flows into equity funds.* * *Across asset classes – Flows into MM (++), bonds (+) vs. equities (~): Despite the fact that flows for total equity funds (+0.0% of NAV, ETFs: +0.0%, MFs: +0.0%) remained subdued over the past week (wed-wed), we see the rotation out of US into European and Japanese mandates holding up and, with it, the YTD delta expanding (US at -1.1% vs. Europe at +3.7% and Japan at +3.2%). Total bond funds on the other hand sustained inflows for a 10th straight week, albeit at a declining pace (+0.1% vs. a 4-week average of +0.2%). MM fund
In other words, everyone is merely doing what they have been conditioned to do for the past 7 years: frontrun central bank money printing. No surprise there.
And some more detail fund flow charts:
And since its a "momentum"-driven world, here is a summary of where flow momentum has been biggest across time.
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