Shareholders withdrew from the bonds – Newspaper Kommersant No. 22 (7467) of 02/07/2023

In January 2023, private investors withdrew almost RUB 3 billion from retail mutual funds. However, the outflows affected mainly bond funds, while shareholders carried money to more risky equity and mixed investment funds. This may be partly due to the positive results of last year for conservative funds. As a result, investors take profits in bond funds and partially shift to more risky funds in the hope of a recovery in the stock market.

In January 2023, the collective investment market faced a net outflow of funds from private investors. According to Kommersant’s estimates, based on Investfunds data, it amounted to almost 3 billion rubles. Basically, the withdrawal of funds affected bond funds – a net outflow from them amounted to 4 billion rubles. In addition, more than 0.46 billion rubles were withdrawn from precious metal funds focused primarily on investments in gold. At the same time, risky mutual funds were in demand – equity funds (an inflow of almost 0.88 billion rubles) and mixed investment funds (more than 0.91 billion rubles).

Participants in the collective investment market attribute this state of affairs to the desire of private investors to fix profits in the category of funds that showed a high positive result at the end of the past year. According to Kommersant’s estimates based on Investfunds data, in 2022, the top 20 best funds included 17 bond mutual funds, which brought shareholders an income of 10-18%. According to Viktor Bark, Director of the Asset Management Department at Alfa Capital Management Company, investors have begun to take profits, as hopes for a rapid decline in market yields and rising prices have not come true yet. In January, the 10-year OFZ yield, on the other hand, rose by 28 basis points to 10.3% per annum. “Investor interest is influenced by a possible increase in the key rate this year, which, in turn, will put pressure on bond prices,” said Andrey Makarov, head of the sales department at Pervaya Management Company.

The withdrawn funds did not completely leave the industry, but were partially transferred to other categories of funds. “The exchange of shares, as a rule, does not incur additional costs and commissions, allows you to save the countdown period for applying the investment tax deduction, and also in the current environment makes it possible to buy cheaper risky assets after the bonds allowed you to save capital in a crisis year”, – says Vitaly Isakov, Investment Director of Otkritie Management Company.

The high interest in more risky equity funds is associated with the underestimation of the Russian stock market after a collapse of more than 40% in 2022. “There are still few people who want to record a loss in equity funds at the level of 30-40% at the end of the year. At the same time, there are more and more investors on the market who are ready to enter the market at current levels in the hope of its recovery,” says Konstantin Kirpichev, Deputy General Director of RSHB Asset Management. Interest in such investments is supported by the rise in the market in January, as a result of which the Moscow Exchange index rose by more than 4% and exceeded 2200 points, returning to the values ​​of mid-November last year. In addition, the recent dividend payments of large companies made it clear that the Russian stock market can generate income not only from rising stock prices, Viktor Bark notes.

In the coming month, the trends of the beginning of the year will continue, namely, the exit from bond funds in favor of equity funds and mixed investments. “As experience shows, a mass investor goes into investment products after the market shows consistently positive results for several months, or even a year. This time, the term will be shorter due to the limited range of alternatives,” Viktor Bark notes. According to Konstantin Kirpichev, the main growth driver will remain the marketing efforts of management companies and banks, while organic client demand is more concentrated in the dynamics of outflows and inflows of individuals on brokerage accounts.

Vitaly Gaidaev