The Australian funds management market experienced record net outflows during March, outpacing similar trends in Asia and Europe, new figures from Calastone reveal.
Calastone, the global back-office fund service provider, reported net outflows across its Australian network hit almost A$4 billion in March as panicked investors headed for the exits.
According to the Calastone metrics, the Australian funds on its platform (which represent about 75 per cent of all managers and 95 per cent of platforms in the country) saw gross outflows of more than A$11.8 billion in March leavened by A$8 billion of inflows.
Gross outflows in March amounted to almost double the highest-ever recorded by Calastone since mid-2018 while inflows also tipped above average during the month.
Previously, the fund-messaging provider had only noted significant net outflows in November 2018 and a slight dip below the x-axis in February 2019 (a month that coincided with the release of the Australian Royal Commission into financial services report).
“The fund flows in Australia were largely in line with international markets in March, with Hong Kong recording net outflows of A$2.7 billion and A$7.3 billion leaving the UK, however the drop was more pronounced in Australia,” Calastone says in a release. “Flows were mostly from bond funds, as was the case in Asia and Europe where political uncertainty produced more volatility throughout 2019 relative to Australia.”
Research house Morningstar reported the US fund market also saw record outflows of US$326 billion in March, more than triple the US$104 billion exodus during the GFC panic in October 2008.
Ross Fox, Calastone head of Australia and NZ, said the Australian funds market had turned around in April with applications slightly outweighing redemptions in the month to date.
Calastone was unable to provide data for the NZ market where it has operated since 2016. The UK-headquartered group has hooked-up with most NZ investment platforms with its fund transaction streamlining service.
Last year Calastone switched its global network to a new blockchain-based system.