Emerging-market equity funds receive big inflows
NEW YORK (MarketWatch) — Flows into emerging-market equity funds hit a year-to-date high last week, with investors showing a marked preference for commodity producers such as Brazil and Russia, according to data from fund tracker EPFR Global.
Emerging Market Equity Funds tracked by EPFR Global took in the most money since mid-December during the week ended March 25. These funds absorbed $2.3 billion of inflows during the week, turning year-to-date flows positive by $2.03 billion.
The surge was led by the $1.9 billion that flowed into diversified Global Emerging Markets Equity Funds, EPFR Global said.
“The latest data certainly paints a picture of money leaving essentially passive vehicles such as money market funds and being put to work in funds offering more risk and higher rewards,” said Cameron Brandt, a senior analyst at EPFR Global, in a statement.
Latin America Equity Funds had their best week since late in the second quarter of 2008, while EMEA [Europe, the Middle East and Africa] Equity Funds absorbed fresh money for only the second time in the past 37 weeks.
“Renewed optimism about U.S. and Chinese demand for commodities underpinned flows into Latin America and EMEA Equity Funds, with funds geared to the biggest raw material producers in the respective regions getting the lion’s share of the new money,” EPFR Global said.
Brazil Equity Funds took in a net $238 million, their best showing since the fourth week of May, while flows into Russia Equity Funds hit a 19-month high.
The benchmark MSCI Emerging Markets Index is up 4% this year. In comparison, the MSCI Brazil index has gained 16% and the MSCI Russia index is up 12%.
Polya Lesova is a New York-based reporter for MarketWatch.