Record-breaking streak continues for fund industry

The Luxembourg fund industry continued its pandemic recovery in July reaching a record €5.5trn in net assets under management, around €900m more than compared to February 2020, the last pre-pandemic month.

Net assets in mutual funds dropped to €4.1trn in March 2020, the month that the World Health Organization declared the coronavirus crisis a global pandemic, from €4.6 trillion a month earlier.

But it has been 16 months of steady growth since then, with funds first breaking the €5trn threshold in January this year and now reaching €5.5trn. Over the last 12 months alone, the volume of net assets rose by 20.01%, regulator CSSF said in a statement.

The number of funds, however, has kept on diminishing, from 3,700 in March last year to 3,541 at the end of July 2021. Including all sub-funds, there were 14,459 fund units active in the financial centre.

European markets benefitted from “better than expected corporate results, the launch of the European Recovery Fund and improving economic data, despite the spread of the more contagious Delta variant of covid-19 and uncertainties relating to the continuing supply bottlenecks,” the CSSF said.

The US market was also strong, off-setting negative performance in Japan, emerging Asian markets, and Latin America.

Luxembourg is the largest investment fund centre in Europe and second largest worldwide, with funds distributed in more than 70 countries.

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