Luxembourg investment funds experienced a slight decrease in net assets during April, reflecting market fluctuations and uncertainties. The total net assets amounted to 5,139 billion euro as of 30 April 2023, down 0.19 percent from the previous month’s figure, according to financial supervisor CSSF.
Compared to April last year, the volume of net assets has decreased by 6.17% percent.
The number of Undertakings for Collective Investments (UCIs) considered for analysis stood at 3,341, slightly lower than the previous month’s total of 3,345. Among them, 2,186 entities adopted an umbrella structure, encompassing 13,071 sub-funds, while 1,155 entities followed a traditional UCI structure. In total, there were 14,226 active fund units in Luxembourg’s financial centre.
In developed markets, European equity UCIs performed well due to positive indicators in the services sector, declining energy prices, and easing inflation. US equity UCIs benefited from better-than-expected corporate results and improving PMIs, while Japanese equity UCIs capitalised on favourable economic indicators and a weak Yen. However, the positive performances of US and Japanese equities were mitigated by currency depreciation against the Euro.
In emerging markets, Asian equity UCIs suffered negative performance due to Chinese market decline and semiconductor export weakness. Eastern European equity UCIs experienced positive performance amid reduced tensions in the energy sector. Latin American equity UCIs faced negative performance despite growth in Brazil’s earnings and rising consumer confidence in Mexico.
Bond yields remained relatively stable in April, with credit spreads tightening and risk appetite recovering as banking sector stress eased. Fixed income UCIs saw positive returns.
Euro-denominated bond UCIs maintained stability in government bond yields, with narrowing spreads reflecting increased risk appetite. USD-denominated bond UCIs delivered positive performance despite USD depreciation against the Euro, driven by tightening credit spreads. Emerging market bond UCIs, however, faced negative returns due to USD depreciation.
Overall, fixed income UCIs experienced positive net capital investment in April, with Euro Money market UCIs leading in inflows.
Development of equity UCIs during the month of April 2023*
