The Worst Quarterly Outflows in Almost 5 Years

Funds domiciled in Taiwan saw a net redemption of TWD 52.2 billion in the third quarter of 2021, the worst quarterly net outflows in 19 quarters. 

Kate Lin, CAIA 02 November, 2021 | 18:03
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Key Takeaways

Morningstar Direct data showed, excluding the outflows from money market funds, the market saw a redemption of TWD 14.4 billion over the period, versus the TWD 209.4 billion inflows posted in the second quarter of 2021.

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This quarter’s major engine for inflows was allocation, overtaking the equity and fixed-income categories, a trend in line with the global markets. Allocation funds were the only group that posted a net subscription for the past six quarters, garnering TWD 124.0 billion in total. Conversely, investors pulled TWD 45.5 billion out of fixed-income funds.

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By Morningstar Category, the other bond and TWD moderate allocation categories saw significant inflows. Taiwan equity continued to take in more assets. Meanwhile, investors continued to redeem their money market funds—primarily denominated in new Taiwan dollars.

Chinatrust, ranking sixth by market share, was the top asset-gatherer in the third quarter, thanks to its senior bond, China equity, and Vietnam equity exchange-traded fund products. The market’s largest player, Yuanta Financial, suffered the most redemptions as investors pulled TWD 21.3 billion from the funds over the same period.

Yuanta/P-shares Taiwan Dividend Plus ETF and CTBC Bloomberg Barclays Banking Senior 10+ Year Bond ETF were among the strategies that gathered the most assets. Yuanta/P-shares Taiwan Top 50 ETF and Capital ICE International 15+ Year US Emerging Markets External Sovereign ETF had the largest quarterly net outflows.

Overall, investors in Taiwan have an aggregate allocation of TWD 132.1 billion into strategies that take into account sustainability issues. Flows into sustainable assets significantly slowed to TWD 6.0 billion net inflows in the third quarter

Morningstar Direct Asset Flows Q3 2021

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About Author

Kate Lin, CAIA

Kate Lin, CAIA  is a Data Journalist for Morningstar Asia, and is based in Hong Kong

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