Emerging Equity Funds Post $42 Million of Inflows, EPFR Says

Emerging-market stock funds took in $42 million in the week ended April 4, as net inflows into diversified developing country funds offset outflows from Brazil and Asia excluding Japan, according to EPFR Global.

Net investment into emerging-nation equity funds has totaled $25.63 billion in 2012, compared with outflows of $18 billion for the same period of 2011, according to data e-mailed yesterday by EPFR, a Cambridge, Massachusetts-based data provider.

So-called Global Emerging-Market funds, or GEM funds, recorded a net inflow for the week of $1.18 billion, Cameron Brandt, EPFR’s director of research, said by e-mail yesterday. GEM Funds have taken in over $1 billion in 10 of the 14 recorded weeks in 2012, he said.

“It’s a fairly standard reaction to rising uncertainty,” Brandt said in a phone interview yesterday. “Funds flow into diversified emerging markets and away from countries seen as higher risk.”

Concern that China’s economy is slowing weighed on investors, Brandt said.

The world’s second-largest economy expanded 8.4 percent in the first quarter, National Development and Reform Commission Vice Chairman Zhang Xiaoqiang said on April 3. That’s down from 8.9 percent growth in the last three months of 2011, the slowest pace for 10 quarters.

Asian funds excluding Japan recorded net outflows of $716 million, according to EPFR. Latin American funds posted net outflows of $374 million, while Brazil-dedicated funds had outflows of $396 million.

Russian equity funds posted their 10th consecutive week of net inflows, the longest streak since the first quarter of 2011. Russia dedicated funds added $16 million for the week.

The average emerging-market equity portfolio posted a 0.35 percent loss for the week, reducing the advance in 2012 to 13 percent, Brandt said.

Emerging-market bond funds registered inflows for the week of $507 million, he said.

To contact the reporter on this story: Leon Lazaroff in New York llazaroff@bloomberg.net

To contact the editor responsible for this story: Emma O’Brien at Eobrien6@bloomberg.net

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