Economic uncertainty in Europe and China sparked a flight to safety that yielded a record setting month for fixed income ETPs, with the products attracting $11.0 billion in net flows, compared with $9.1 billion for the previous record month, January 2012.
Government bond ETPs attracted record breaking inflows of $5.6 billion driven by flows of $4.4 billion into US Treasury bond products. The previous monthly high for government ETPs of $3.6 billion was set in June 2010. High yield bond ETPs saw monthly outflows of ($1.3) billion, the first month of redemptions since November 2011.
Emerging markets equity ETPs drew $3.3 billion, with flows of $8.3 billion into two new Chinese equity funds outweighing outflows of $5 billion from a broad range of other emerging markets products. In developed markets equities, DAX German equity funds swung back with strong flows of $4.3 billion in May on the heels of ($5.1) billion outflows last month. Japanese equity ETPs also had a strong showing in May, garnering $3.6 billion.