Singapore sees fund outflows in Q2

For the first time in two years, authorised and recognised unit trusts registered for sale in Singapore posted a quarterly net outflow.

The loss amounted to S$62.28m ($44.59m) for the second quarter this year, compared with a net inflow of S$1.55bn in the previous quarter.

Net outflows in fixed income funds were the main driver, with net redemptions amounting to S$873.67m.

Against the backdrop of high inflation and monetary tightening, all bond categories recorded fund outflows in the second quarter.

Asia-focused fixed income funds faced the largest redemptions, with net outflows of S$520.41m, followed by global fixed income (S$202.64m) and US fixed income (S$91.73m).

Only two major asset classes recorded net subscriptions for the quarter – equity and allocation.

Equity funds posted the highest net inflows, at S$563.45m for the quarter, but this marked a significant decrease compared with the first three months on 2022 (S$1.05bn).

Among all equity types, Asia Pacific ex-Japan equity continued to be in greatest demand in the second quarter, totalling S$170.09m, followed by US large-cap blend equity (S$73.12m) and global large-cap blend equity (S$65.39m).

On the other hand, gross inflows into allocation funds were stable quarter-on-quarter.

The asset class reported inflows of S$1.16bn from April to June, while outflows hit S$797.75m.

Yet money market funds, one of the most popular asset classes in the first quarter, posted net outflows during the subsequent three-month period.

Investors’ subscriptions to the cash management product led to an aggregate of S$104.2m in net outflows, while the asset class saw net inflows of S$446.31 in the first quarter.

Fund flows by asset class for Q2 2022 (in S$m)