In December they had net income of $1.8 trillion and $253 billion respectively. The dollar linked suffered rescues of $450,000 million, after having been the protagonists of 2023.
The assembling of portfolios throughout December was seen conditioned by the measures of the new Government. Thus, the industry Common Investment Funds (FCI) moved in step with investors’ expectations regarding inflation and the dollar. The devaluation of the official exchange rate and the lowering of interest rates central bank and of the Treasury instruments impacted investors’ decisions when seeking coverage. In this framework, immediate liquidity funds were the main protagonists of the last month of the year and the funds also regained their shine. CER (which had been left behind in much of 2023) due to forecasts of a strong inflationary acceleration in the first half of 2024.
In December, the FCI Money Market accumulated subscriptions for $1.8 billion. The positive trend of immediate liquidity funds, which represent the 50% of the industrythey started it after the runoff, adding subscriptions for $905,000 million in the last week of Novemberwhich allowed him to recover what was rescued in the previous weeks.
In addition, CER funds accumulated net subscriptions of $253 billion in December. In this way, the FCI indexed to inflation managed to close a positive month for the first time since August: the segment had rescues in most months, with the exception of July, August and December. After runoff, started a greater demand in CERswhich moderated the bailouts evident before the second round, although they had still closed November with a negative balance of $10,583 million.
Eduardo Herrera, CEO of IEB Fundsdetailed: “There was a strong change in trend in flows within the mutual fund industry fundamentally motivated by portfolio changes by investors who perceived that after the devaluation jump produced in the middle of the month, the instruments dollar linked lost certain appeal in front of the instruments CER and to a lesser extent fixed rate. The factors that explained the preceding dynamics were that after the jump in the exchange rate of 118% and the announcement by the new Government of a crawling peg of 2% monthlyinvestors perceived that in the short term an opportunity was reopened to make ‘carry’ in pesos through CER instruments that would reflect in subsequent months the transfer to prices of the exchange correction and to a lesser extent through fixed rate investments.”
Along these lines, the funds dollar linked they had rescues for $450,000 million during December. These funds had been the main protagonists of the last months of the electoral process due to the strong expectations of the investors from a devaluation jump. In November, funds indexed to the official dollar had net subscriptions of $253.5 billioncontinuing the same dynamic pre and post ballot. Likewise, in October when the first round occurred, they managed to capture a record of $555,375 million.
Paula GandaraCIO Adcap Asset Management, highlighted: “The devaluation caused a shift in flows in the fund industry. Rescues are presented, but at levels contained in the dollar linked (DL) funds, and subscriptions in the funds CER and the T+1. The participation of the different people is very illustrative. types of assets in the industry. As a year-over-year comparison, at the end of 2022 T+1 funds represented 8% of the industry, while CERs 5.4% and DLs 6.5%. On December 7, the last business day before Milei took office, the T+1 had fallen to 4.3%, and the CER to 4.2%; while DLs rose to 13.2% of the industry. At the end of 2023, T+1 rose to 5%, CER took off further to 5.3% and DL fell to 10.6%. The FCI flows reflected the effects of the devaluation with the sales of DL funds, along with inflation expectations and a decrease in sovereign risk.”
Along these lines, Gándara pointed out that since the beginning of December a return to T+1 was seenwhich had net purchases for $227,651 million in the month. The departures of the dollar linked “they reached the $450,000 million in the total for the monthaccumulating ransoms (which continue to this day) for $700,000 million since December 13the day of the announcement of the measures (Luis) Caputo”, he highlighted.
Source: Ambito
