Equity ETPs listed in Europe, the Middle East, and Africa experienced net outflows of more than $13 billion during August, the largest monthly outflow on record, according to data from BlackRock.
August saw the largest net outflows on record from EMEA-listed equity ETPs.
The heavy redemption activity was significantly greater than the second-largest monthly outflow to date, April 2012, when $5.4bn left equity ETPs.
European equities had their largest outflow month since April 2018 with investors selling $4.1bn, reversing the $1.5bn added in July.
Reflecting the escalation in trade tensions, investors fled emerging market equity ETPs to the tune of $3.7bn, another monthly record. The last outflow month of similar magnitude for EM was in June 2018 (-$2.1bn), when investors reduced exposure on the back of geopolitical concerns and trade tensions.
ETPs providing exposure to US equities just about managed to buck the trend, gathering $99 million.
Fixed income ETPs added a healthy $4.4bn in August, although this was somewhat lower than the $7.7bn gathered in July. Year-to-date (YTD), the asset class has pulled in $44.9bn, marking the biggest year of asset gathering on record – the previous full-year record was 2017 where $30.4bn was added.
Rates ETPs gathered the majority of fixed income flows in August with $2.2bn. Flows into investment grade and high yield ETPs remained strong with $1.3bn and $0.6bn gathered, respectively.
Emerging markets debt ETPs were the only fixed income exposure to lose assets. According to BlackRock, the segment took a hit in the first week of August, shedding $1.5bn, as trade tensions escalated. Since then, investors have allocated more to local currency emerging markets debt ETPs ($484m added over three weeks) while selling $219m of hard currency ETPs.
Commodity ETPs continued their winning streak – thanks to gold and silver ETPs – gathering another $1.8bn during August. Gold ETP inflows accelerated to $1.7bn, eclipsing the $0.7bn added in July. Investors have added $6.2bn net new assets in gold ETPs since the start of the year in an effort to buffer portfolios against economic concerns, trade tensions, and geopolitical risks. Investors also allocated $140m to silver ETPs, lifting YTD net inflows to $0.7bn.