Emerging market flows broaden; India-focused funds see first inflow after five weeks: EPFR Global

Investor interest in emerging markets appears to be widening, with fresh allocations picking up across a broader set of geographies. After five consecutive weeks of outflows, India-focused equity funds recorded a return to positive territory, according to Cameron Brandt, Director of Research at EPFR Global.. The trend also includes steady inflows into diversified emerging market funds, often seen as a precursor to a broader risk-on shift.China is seeing some renewed interest as well, though Brandt said inflows are still far from exceptional.

At the same time, money has been moving out of the once-popular ex-China fund group. “One was growing quite aggressively last year and still adding new funds, but not seeing much fresh money,” he explained.

Also Read | Raymond James strategist adds travel, digital payments to portfolio; trims ICICI BankUS equity funds are showing a similar trend, where inflows continue, but not at levels that match the strong rebound in major indices over the summer. In Europe fund rotation stopped briefly but turned positive again this week. However, Brandt flagged some investor caution as fiscal stimulus measures face uncertainty from both the Ukraine conflict and rising bond yields.

Also Read | India a strong structural bet, but Brazil offers better near-term value: Lynn Alden

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