Euro asset managers saw active fund outflows of €0.7 billion in June, which is an annualized -0.9% of assets under management (AUM), UBS analysts said in a note on Monday. However, the 3-month average outflow rate improved to -0.3% of AUM, marking the best level since January 2022.
The outflows were primarily driven by Abrdn, which saw £1.1 billion in outflows, and ASHM with £0.1 billion. In contrast, the other asset managers recorded net inflows.
Within the group, fixed-income flows remained strong, equity flows were relatively flat, and multi-asset fund flows continued to be negative.
“For the fifth straight month, Man Group recorded the strongest active fund flows,” analysts highlighted.
Beyond Europe, June was a positive month for major global equity indices, with the S&P 500, MSCI World, TOPIX, and MXAPJ indices all rising by 2% to 4%. However, higher political uncertainty led to a decline of 1% to 6% in European equity markets.
“Meanwhile, European equity market volatility jumped in June, while US equity market volatility moderated. The major global bond indices we track were up 1% in June,” analysts noted.
The shares of traditional Euro asset managers fell by 7.0% in June on a weighted average basis, resulting in a 580 basis point underperformance compared to the STOXX 600. Within this group, BMED recorded the best performance with a 2% decline, while ASHM was the worst performer, with a 13% drop.
As a group, EU asset managers were valued at 9.6x forward consensus earnings per share (EPS) at the end of June, down from 10.4x in May. This valuation is approximately 1.5 standard deviations below the historical average of 12.7x.
“At these valuation levels, the market is pricing in outflows to persist for the remainder of the year,” UBS noted.