2022 has become the fifth-best year on record in terms of European ETF flows with €82 billion in net subscriptions, Amundi publishes in its Annual Report. Assets under management now total €1.24 trillion and ETF have recorded annual growth of 17% over the past decade.
Investors sought ways to reposition their portfolios during the year, suffering significant losses from their allocation to both equities and bonds.
European equity ETF
European equity ETF recorded inflows of more than €54.1 billion last year. There was significant traction for global and US exposures at the expense of Europe, which experienced significant outflows. Emerging markets accumulated steady flows month after month and China remained at the top of investors’ agenda.
As a result, alternative energy and cybersecurity exposures gained traction, with significant inflows into thematic ETF.
European fixed-income ETF
European fixed-income ETF booked inflows of more than €31.6 billion in 2022. It has been a challenging year for fixed-income investors, who faced losses with the market downturn. As a result, investors continuously adjusted their risk exposure.
In the second quarter, investors initially sought short-term bond exposures, such as short-term credit ETF, to adjust their duration risk against a backdrop of higher rates. As the year progressed, along with the central bank tightening cycle, appetite for longer-duration exposures increased.
Sovereign bonds (mainly EUR and USD) and investment-grade corporate bonds were the most favored segments. Emerging market debt saw significant outflows, especially in yuan-denominated bonds.
Strong appetite for ESG ETF confirmed
ESG ETF recorded inflows of €52.7 billion last year, mainly targeting Climate and Broad ESG. The lion’s share went to ESG fixed income ETF, which attracted 66% of total fixed income flows (€20.8 billion in net subscriptions, out of €31.6 billion).