Amundi ETF Flows Analysis : European equity flows surge in rotation; investors seek more defensive positions
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Amundi ETF Market Flows Analysis with data as at 30 April 2025
Fannie Wurtz Head of Distribution and Wealth Division, Passive & Alternatives business lines
- European strategies accounted for half of the month’s overall inflows of €16.9bn.
- Investors allocated into defensive strategies in both equities and fixed income.
- Smart beta, minimum volatility and government bonds all posted gains.
Overview
European-domiciled UCITS ETFs recorded inflows of €16.9bn in April 2025, an increase of 47% on the €11.5bn recorded in the same month in 2024.
The rotation to European equities showed no sign of abating, as half of the overall net new assets (NNA) in the month were directed towards these exposures.
This underscores the year-to-date trend of investors preferring Europe over the US in equities. Equities accounted for the bulk of NNA at €14.7bn while fixed income contributed just €2.2bn.
In both equities and fixed income, investors have repositioned to take more defensive positions.
In the former, smart beta strategies are in favour while in the latter investors have shifted assets to government debt.
Despite market uncertainty introduced by US tariffs, global ETFs accumulated €136.3bn NNA with equities gaining €84.8bn and fixed income adding €45.8bn.
Equities: Appetite for Europe
Investors allocated €14.7bn to European-registered UCITS ETFs in April with investors adding €8.5bn to European equities while withdrawing €2.0bn from US equities. World indices added €4.9bn.
Investors added €3.5bn to eurozone-focused equity indices and pan-European equities gained €1.8bn.
Non-eurozone strategies, in particular Nordic indices, accumulated €1.6bn.
Industrial sector ETFs gained €0.9bn and investors also added €0.3bn to IT strategies. Financial strategies posted outflows of €0.9bn – which could be related to the market sell-off as these companies tend to heavily correlated with market movements.
Smart beta also proved popular with income adding €1.2bn and minimum volatility gaining €0.7bn.
Investors had not been allocating to minimum volatility before the sell-off – but this illustrates how investors are now favouring defensive strategies within equities.
Investors have been favouring income since the start of the year as this is less volatile than value or momentum. There were outflows of €0.5bn from equal-weight strategies.
Fixed income
European-registered fixed income UCITS ETFs gained €2.2bn in April with investors adding €3.5bn to government bonds and €1.5bn to money-market strategies.
There were outflows of €1.2bn from high-yield strategies, €1bn from investment-grade corporate debt and €0.7bn from broad indices.
This reallocation to government bonds away from corporate credit is a natural reaction to higher market volatility with investors moving towards a more defensive stance.
Within government debt, investors are favouring euro-denominated bonds, adding €2.5bn to this asset class and €0.9bn to US-dollar-denominated bonds.
Short-term strategies were the most popular government bond strategy with euro-denominated debt gaining €1.2bn and US-dollar denominated adding €0.9bn. Total flows into short-term government debt were €2.2bn.
Last year investors were agnostic about government bond maturity preferring all maturity strategies but that has changed, reflecting the level of market uncertainty.
Commodities
In last week of April, there were outflows of €1bn gold exchange-traded commodities and exchange-traded products.
Source: ETFWorld
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