Private credit might be less attractive than it was last year as investors rush into the market, but there are sweet spots to be found.
Commodities sector funds were the only ones among the nine major sector fund groups tracked by EPFR Global to post inflows. Commodities sector funds posted inflows for the eighth time in 10 weeks year-to-date during the first week of March. So far this year, this fund group has absorbed a net $3.64 billion and returned over 18%. That makes it the best performer among the major EPFR Global-tracked fund groups and second only to money markets funds in terms of net flows.
Last week also showed some evidence of bargain hunting. Europe equity funds posted inflows for the first time in 27 weeks mainly due to the $1 billion taken in by a single Swiss fund, EPFR Global says. High-yield bond funds snapped an 11-week losing streak, meanwhile.
Flows into the more defensive fund groups were generally subdued, with money market, US bond and balanced funds recording inflows that were well below their recent weekly averages.
Funds geared to regions or countries that are big importers of commodities did not fare well. Asia ex-Japan equity funds were hit with net redemptions for the 12th time in the past 13 weeks, US equity funds for the sixth time in seven weeks and Japan country funds for the 48th time in the past 49 weeks.
Europe, Middle East and Asia equity funds were the big winners among the major emerging markets fund groups in early March as investors sought exposure to the energy and mineral resources of Russia, South Africa and Middle East oil producers. The $695 million absorbed by these funds makes them the only group to have net inflows year-to-date.
Regulators keep their eyes open on tightening insurance industry by introducing more detailed risk management requirements, which could bring pressure on smaller players.
China and India are more obvious choices for AustralianSuper to consider in Asia Pacific, but the super fund currently lacks the expertise and prefers to stick to the US and Europe.
CDPQ's Ivanhoe Cambridge hires ex-GIC real estate expert; NZ Super adds board member; Future Fund appoints chief people officer; BlackRock real estate CIO joins Singapore's Capitaland; AMP Capital hires MD for energy; Northern Trust AM names new CIO; T Rowe Price hires AU and NZ institutional head; Nuveen hires Southeast Asia institutional head; Citi names sustainability head in Singapore; and more
Investors are increasingly turning to private companies and private debt in their hunt for ESG alpha, but the age-old problem of transparency and due diligence remains