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The first quarter of 2021 ended with US Money Market, Equity and Bond Funds attracting a combined $68 billion as COVID-19 vaccination rates in the world’s largest economy continue to climb and stimulus fueled equity indexes hit fresh record highs. Only funds with global mandates enjoyed anything like the same level of flows during the final week of March, with Global Emerging Markets (GEM) and Global Equity Funds seeing year-to-date inflows hit $34 billion and $143 billion respectively and Global Bond Funds posting their biggest weekly inflow since early February.
Investors continue to buy into funds with socially responsible (SRI) or environmental, social and governance (ESG) mandates. But appetite for exposure to emerging markets assets dimmed appreciably in late March with flows to Emerging Markets Equity Funds running at less than a third of the levels seen in February and Emerging Markets Bond Funds ending the quarter by posting their fourth outflow in the past six weeks.
Both US equity markets and flows to EPFR-tracked US Hedge Funds appeared to shrug off the implosion of Archegos Capital, which triggered forced sales of some stocks when it defaulted on margin calls from creditor banks, and Financial Sector Funds also ended the week with a solid inflow.