And it is, in this game of probabilities (of comings and goings), the Mutual Funds industry (FCI) is a board that reflects the great uncertainty that reigns today in the markets.
Without going any further, in a scenario where pesos abound, the fund industry does not go unnoticed. With more than $5.6 trillion in assets under management, its growth is notably accelerating, mainly thanks to immediate liquidity funds.
This implies an increase of 12% so far this month, tripling the average of 4% of the last 6 months and accumulated in the year +63%. In dollars, and even given the rise in the reference exchange rate, AUM also grew (+6%), even reflecting a (slight) increase in the year.
How did we mention the main concentration remains in immediate liquidity pesos. In fact, GMs still represent more than half of the industry, and explained just over 70% of the increase in PN in the last month. Let us remember that, in times of market tensions, investors use these funds as a refuge – being the most conservative option for immediate liquidity.
Likewise, this does not mean that the rest of the strategies do not show us the appetite of investors for the different instruments offered by the local market.
What do we mean? The beginning of September had been clear. Delayed expectations of devaluation, the preference for assets adjusted for inflation resurfaced. All of this helped by high roll over rates that dispel short-term doubts about this debt and inflation that will remain high (supported by a “mountain” of pesos). The latest REM of the BCRA is enough as a reference, which proposes an inflation path of between 6.5/5.8% per month until the end of the year -estimates that, it is worth mentioning, were revised upwards with respect to the previous report-.
Let us remember that this segment maintained three consecutive months of net outflows (with the record in June where more $236 billion were rescued). In this sense, in the first fortnight it was possible to accumulate inflows for more than $12.8 billion – at an average of $1.1 million per day.
This pace slowed down in the last week, and even on Monday the 19th the segment suffered bailouts of $6.6 billion, cutting half of what had been accumulated up to that moment. Even so, the month remains positive, with net subscriptions of almost $10 billion.
However, in contrast to the CER, the Dollar Linked flow moves in negative territory -although showing a change in trend compared to the beginning of the month-. Driven by the misunderstanding of the implicit devaluation rates in the ROFEX curve and the drop in DL sovereign bonds, this segment had lost some $16 billion in the first fortnight. With the latest developments (tightening of the trap), this dynamic seems to have stopped, although still without a defined course.
performance issue
The appetite for these strategies is also supported by their performance. In terms of performance, and as in August, the CER funds continue to lead the rankings in the fixed income segments in pesos.
So far this month, these have risen -on average- 5.2%, surpassing funds focused on corporate risk (4.8%) and dollar link coverage (3.4%). Even above the path of the CER coefficient, which stands at around 4.5%. It is worth noting that, in 6 of the last nine months, these funds managed to outperform -by far- their benchmark.
In this context of rising rates, the more aggressive short-term Fixed Income funds (T+1) continue to put up a fight, but it is still not enough. So far in September, these total 3.9%, followed further back with an average 3% by those funds with more conservative portfolios (greater liquidity in the portfolio).
For now, and thinking in the very short term, we continue to see value in hedge funds against inflation. Always bearing in mind that its weighting over the total of a portfolio will depend on the profile of each investor.
PPI Mutual Funds Analyst
Source: Ambito
