Towers Watson

Administration Seminar

By Amanda Leek

Emerging market (EM) funds attracted new money in the fourth straight week of positive flows last week, but with all investment coming from ETF investors, according to a report published by EPFR Global.

In the last week, $743 million was added to EM ETFs, while $348 million was cut from traditional funds, said the report. To date in August, ETF investors have added $3.4 billion to EM funds or almost 95% of total allocation to all EM funds.

ETF flows now account for almost all EM allocations. ETF flows and ETF exposure to EM assets has been steadily increasing as redemptions from the more traditional retail funds have also risen.

Investors also appear to remain wary of specific country bets and withdrew a net $20 million from Russia funds in the last week, reversing the previous week’s inflow of $23 million. However within that ETF investors added $25 million. Among country-specific funds, only South Korea attracted big money ($233 million via an ETF), while all others reported modest positive or negative flows.

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The Pensions Insurance Specialist

Other stories you may find of interest:

Worries about funding deficits remain
Defined benefit scheme sponsors and trustees focus more on critical funding-related risks impacting their schemes, due to continued market volatility and economic uncertainty, according to the MetLife Assurance 2011 UK Pension Risk Behaviour Index

Different risk attitudes in the UK and US, MetLife says
UK and US pensions markets have ‘significant’ differences in their approach to risk, a study by MetLife revealed

Risk report warns of underlying risk to DB schemes
A new risk report from PensionsFirst aims to shift the focus from overall deficit numbers to underlying risk in analysis of defined benefit (DB) pension schemes, and describes significant underlying risks which could drive deficit swings of billions of pounds over short time periods

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