March was the best month since the beginning of the year for the collective investment market

March was the best month since the beginning of the year for the collective investment market. Shareholders invested more than 16.7 billion rubles in retail mutual investment funds (MUIFs), which is six times higher than in February. There was interest in all major fund categories. Bonds and stocks received record volumes since pre-crisis 2021.

In the first month of spring, investors significantly increased activity in the collective investment market. According to Kommersant’s estimates, based on Investfunds data, the net inflow of funds into all retail funds (open-ended and exchange-traded mutual funds) amounted to 34.8 billion rubles.

This result is more than six times higher than the February figure (5.4 billion rubles), although it is still inferior to the record figures of the end of last year (see Kommersant on January 9). “Repayments in March remained at the level of February, but the interest of shareholders in purchasing funds has increased noticeably,” says Zokir Zokirov, head of sales development in the retail network of the Era of Investments Management Company.

The recovery in the market is primarily due to increased demand for money market funds, interest in which had been declining over the previous two months. In March, the net inflow into such funds amounted to almost 17 billion rubles, which is five times more than the receipts in February (3.5 billion rubles). This was facilitated by the tightening of the Bank of Russia’s rhetoric since the beginning of the year, which led to a shift in market expectations for a reduction in the key rate from the second quarter to the second half of the year.

“Money market funds traditionally come to the fore during periods of tight monetary policy. They quickly respond to the dynamics of the key rate, and also give the investor the opportunity to withdraw their funds at any time without loss of income,” notes Managing Director for Investments of Management Company PSB Nikolay Ryaskov.

The demand of private investors for bond funds also increased, the net inflow of funds into which amounted to 5.1 billion rubles, the maximum positive result in the last three years. The main attractions went to funds of foreign currency bonds, Eurobonds, replacement and yuan bonds (net attraction – over 8.1 billion rubles).

“We have been observing significant inflows into foreign currency bond funds since the beginning of the year, this is due to the desire of investors to hedge against the devaluation of the ruble, as well as to receive high foreign exchange returns,” explains Viktor Bark, head of the asset management department of Alfa Capital Management Company. The replacement bond index yields 6.8%, according to Cbonds.

Since March, investors have become more willing to buy the riskiest category of equity funds. According to Investfunds, net inflows to them more than quadrupled over the month and exceeded 6.4 billion rubles, the highest result since December 2021. Another about 5.2 billion rubles. shareholders invested in mixed-type funds, the best performance since mid-summer last year.

The high interest in such mutual funds, says Andrei Makarov, head of the sales department of Management Company Pervaya, is associated with the approaching dividend season. The same factor became a key trigger for the growth of the Russian market in 2023, following which the Moscow Exchange index grew by almost 44%. “Many investors have made good money, so this year attention to dividend stories and the stock market remains heightened,” notes Mr. Makarov.

In the coming months, managers expect further growth in attractions in the collective investment market, which will be facilitated by the recent growth of the stock market and expectations of the Bank of Russia’s transition to a looser monetary policy.

Last week, the Moscow Exchange index rose above 3,400 points for the first time since February 2022. It was not possible to stay at the local maximum, and at the end of Friday trading the index amounted to 3395.37 points, which is almost 2% higher than the values ​​at the end of March. “As macro factors and the Central Bank signal the possibility of starting a rate cut cycle, investors will increase investments in bond and mixed funds,” says Andrei Makarov.

According to Victor Bark, possible changes in tax policy regarding personal income tax can increase the attractiveness of mutual funds for investors, as the importance of benefits for long-term ownership of shares will increase.

Vitaly Gaidaev