Investment funds have R$ 61.7 billion in redemptions in July, says Anbima

Investment funds recorded net redemptions of R$ 61.7 billion in July, according to data from the Investment Funds Bulletin of Anbima (Brazilian Association of Financial and Capital Market Entities).

This is the second time in the year that outflows have surpassed contributions in the month — the first was in May, with net withdrawals of R$ 53.5 billion.

According to Anbima, the result was driven by FIDCs (Investment Funds in Credit Rights), fixed income funds, multimarkets and shares.

The FIDCs had net redemptions of R$ 23.86 billion, however, around R$ 25.2 billion was redeemed by a single fund of the class, “indicating that this movement does not represent a market trend”, says Anbima. In 2022, these fund models register a net inflow of BRL 8.6 billion.

Fixed income funds registered a negative balance of R$ 17.6 billion in July, as a result of the R$ 17.8 billion also redeemed by a fund.

“With interest rates remaining at high levels, fixed income funds remain attractive to investors by reconciling higher returns and a more conservative strategy, which explains the higher balance among all classes of the industry in 2022 (R$ 83.6 billion)”, highlighted the association.

In turn, the multimarket and equity classes, portfolios that present greater volatility, had a negative net inflow of R$ 21.6 billion in the month. The redemption of multimarket funds was R$13.3 billion, higher than the R$8.3 billion of equity funds.

This same dynamic occurs with the balance from January to July, informed the association. Multimarkets have R$73.3 billion in net outflows and shares have net redemptions of R$52.4 billion.

“Uncertainty in relation to the external scenario and doubts about the performance of the economy in a year of electoral cycle contribute, to some extent, to a greater aversion to risk on the part of investors”, informed Anbima.

Pedro Rudge, vice president of the association, said that “despite the concentrated movements of the market in July, it is possible to perceive a search by investors for other fixed income products in addition to funds and the continuity of redemptions in the most daring classes, such as the the case of multimarkets and equity funds. This situation should remain for a while longer due to the new Selic high this week”.

The Monetary Policy Committee (Copom) of the Central Bank (BC) decided to increase the basic interest rate on August 3, by 0.5 percentage point, to 13.75% per year.

Profitability

Despite the greater attractiveness of fixed income due to the interest rate, the type of category that had the highest profitability in July was investment abroad, with 1.92%.

When the comparison is made over 2022, investments that have at least 80% of their portfolio in government bonds and low-risk assets showed a better return, at 8.6%.

Among the multimarkets, the monthly highlight was the type long and short neutral with a return of 2.82% in July and 11.82% in the year. This type of fund operates via assets linked to the equity market.

In the share class, all closed the month positive, with emphasis on the sectorial ones (investing in companies in the same sector) with a return of 10.53% in the month.