The sharp volatility in global financial markets during last year’s second half took a toll on investors’ collective psyche, so it’s no surprise that fund flows took a hit in 2015.
According to numbers released Tuesday by Morningstar Inc., total asset flows into global mutual funds and exchange-traded products were $949 billion last year, down 32 percent from the prior year’s total of $1.4 trillion.
It was even worse in the U.S., where fund flows of $263 billion last year were a nearly 55 percent drop-off from inflows of $580 billion in 2014. On the flip side, Asia was the most robust region with inflows growing 18.6 percent.
In its fourth annual Global Asset Flows Report, the Chicago-based investment research company highlighted some of the winners and losers in the fund world in 2015.
The winners included alternative funds, where double-digit growth in flows was tops among all global category groups. Morningstar chalked that up to investors wanting diversity and consistency as volatility rocked the financial markets.
Elsewhere, flows into allocation funds outpaced those of fixed-income funds, giving the former category the second-largest inflows among global category groups with $171 billion. Equity funds far-and-away led the pack with flows of $305 billion.
Vanguard saw the most inflows in the fund industry at $251 billion, thanks to growing demand for its passive index strategies.
Regarding actively managed funds, Fidelity and J.P. Morgan attracted the most inflows at $57 billion and $23 billion, respectively.
The Morningstar report incorporated more than 92,000 fund portfolios. The company says it estimates net flow for mutual funds by computing the change in assets not explained by the performance of the fund, and net flow for ETPs by computing the change in shares outstanding.