Fund Flow Weekly Summary (Jan 14-20)
Core Content
This report outlines the fund flow trends for the week of January 14-20, focusing on equity and bond funds, both globally and regionally, with particular emphasis on Asia and Korea. It also includes insights on the behavior of domestic and foreign investors and the top stocks net bought by different investor types.
Main Points
Equity Fund Flows
- Flight to Safety Continued: Amid ongoing oil-price declines and financial market jitters triggered by China, the trend of "flight to safety" persisted.
- North America Equity Funds: Experienced a third consecutive weekly net outflow, though the severity decreased compared to the previous week.
- Asia Pacific and Western Europe Funds: Saw increased weekly net inflows.
- Asia ex-Japan and GEM Funds: Net outflows increased slightly.
- Emerging Markets (EM): Both equity and bond funds experienced net outflows, with significant outflows from China, India, and Vietnam.
- Korea Equity Funds: Net inflow of USD375m, primarily into domestic equity funds, as the Kospi dipped below 1,900, drawing bargain hunters.
- Domestic Equity Funds: Inflows doubled week-on-week to KRW4.41 trillion, indicating a shift in investor behavior due to attractive valuations rather than a return of risk appetite.
- ETFs vs Non-ETFs: Non-ETFs saw a net inflow for the third week in a row, suggesting a preference for non-exchange-traded funds.
Bond Fund Flows
- Overall Bond Fund Flows: Experiencing a net outflow for the first time in two weeks.
- DM Bond Funds: Overall net outflow, with substantial outflows from global and Western Europe funds.
- Asia Bond Funds: Net outflow for the first time in three weeks, reflecting heightened uncertainties in emerging markets.
- North America Bond Funds: The only group with a net inflow, indicating continued confidence in US bonds.
- Domestic Bond Funds: Attracted over KRW1 trillion, showing a preference for safe assets.
Foreign Net Flows in Equities
- Foreign Investors: Net sold in all Asian markets, with the most significant outflows observed in India and China.
- Korea: Net inflow to domestic equity funds increased as the Kospi dipped, but foreign investors continued to sell.
- Asia ex-Japan: Net outflow continued, with notable outflows from India and China.
Domestic Fund Flows
- Domestic Institutional Investors: Showed a net inflow into Korean stocks, with local institutions increasing their holdings in key companies.
- Top Stocks Bought by Domestic Institutions: Included Samsung C&T, Naver, Samsung Electronics, and others, reflecting a concentration in large-cap and tech stocks.
Key Information
Weekly Net Flows Summary
| Region |
Net Flows (USDm) |
% of AUM |
4-Week Average (USDm) |
% of AUM |
| Global |
(46) |
0.0 |
698 |
0.0 |
| Asia Pacific |
2,837 |
0.8 |
1,569 |
0.4 |
| Western Europe |
626 |
0.1 |
888 |
0.1 |
| North America |
(4,660) |
0.1 |
(6,515) |
0.2 |
| EMEA |
(62) |
0.2 |
(26) |
0.1 |
| EMs: Subtotal (A) |
(2,237) |
0.3 |
(1,142) |
0.2 |
| Total (A+B) |
(3,478) |
0.0 |
(4,501) |
0.1 |
Bond Fund Flows Summary
| Region |
Net Flows (USDm) |
% of AUM |
4-Week Average (USDm) |
% of AUM |
| GEM |
(1,474) |
0.9 |
(715) |
0.4 |
| Asia ex Japan |
(500) |
0.8 |
203 |
0.3 |
| Latin America |
(262) |
2.1 |
26 |
0.2 |
| EMEA |
(29) |
0.3 |
(2) |
0.0 |
| EMs: Subtotal (A) |
(2,265) |
0.9 |
(488) |
0.2 |
| Global |
(2,366) |
0.4 |
(971) |
0.1 |
| Asia Pacific |
(30) |
0.1 |
2 |
0.0 |
| Western Europe |
(1,112) |
0.2 |
(368) |
0.1 |
| North America |
2,959 |
0.1 |
2,305 |
0.1 |
| DMs: Subtotal (B) |
(549) |
0.0 |
968 |
0.0 |
| Total (A+B) |
(2,814) |
0.1 |
480 |
0.0 |
Top Stocks Net Bought (KRWb)
Foreign Investors
| Company |
Market Cap |
Weekly Net Buying (Value) |
% of Market Cap |
| Hanwha Chemical |
3,951 |
28.7 |
0.7 |
| Woori Bank |
5,638 |
12.2 |
0.2 |
| Hana Financial Group |
5,935 |
9.2 |
0.2 |
| SK Innovation |
12,252 |
7.1 |
0.1 |
| Dongbu Insurance |
4,524 |
6.8 |
0.1 |
| Samsung SDI |
6,911 |
5.3 |
0.1 |
| Grand Korea Leisure |
1,277 |
4.6 |
0.4 |
| LG Household & Health Care |
14,541 |
4.4 |
0.0 |
| Kepco KPS |
4,280 |
4.3 |
0.1 |
Local Institutional Investors
| Company |
Market Cap |
Weekly Net Buying (Value) |
% of Market Cap |
| Samsung C&T |
28,264 |
95.4 |
0.3 |
| Naver |
21,063 |
84.8 |
0.4 |
| Samsung Electronics |
166,596 |
79.4 |
0.0 |
| Hyundai Mobis |
23,363 |
47.6 |
0.2 |
| Samsung Life Insurance |
19,680 |
41.7 |
0.2 |
| Samsung Fire & Marine |
13,383 |
32.7 |
0.2 |
| Kepco |
32,419 |
32.0 |
0.1 |
| Hanmi Pharmaceutical |
7,565 |
25.4 |
0.3 |
| Posco |
13,601 |
23.6 |
0.2 |
| Samsung SDS |
19,306 |
22.0 |
0.1 |
Conclusion
The week saw a continued "flight to safety" as global uncertainties and the US Fed's potential rate hike pressured North America equity funds. Emerging markets, particularly China, India, and Vietnam, experienced net outflows in both equity and bond funds. In contrast, Korea's domestic equity funds attracted significant inflows due to the Kospi's dip, suggesting a shift towards undervalued assets. Domestic bond funds also saw inflows, reinforcing the preference for safe assets. Foreign investors remained net sellers in all Asian markets, while local institutional investors increased their holdings in large-cap and tech stocks. The report highlights the importance of market valuations and macroeconomic conditions in influencing fund flows.