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Decade-long view: South African fund flow trends

26 July 2023 Michael Dodd, Senior Fund Analyst at Morningstar Investment Management SA
Michael Dodd, Senior Fund Analyst at Morningstar Investment Management SA

Michael Dodd, Senior Fund Analyst at Morningstar Investment Management SA

Key Takeaways

- The local fund industry has continued to grow both in assets and in the number of options available to investors.
- The South African fund landscape remains dominated by multi-asset Allocation funds.
- Fixed Income funds increased their market share from 17% in 2012 to 24% at the end of 2022.
- Global Equities have been the last decade’s biggest winner – both in allocation and performance.
- There has generally been a shift out of lower risk Money Market funds into slightly higher risk, Fixed Income fund options.
- The ASISA Global Equity General fund offering exploded from offering only 30 funds at the end of 2012 to around 130 funds at the end of 2022.
- The once-popular category of South African Real Estate funds has seen a notable decline.

At the end of 2012, there were roughly 900 different South African-domiciled funds available for investment. Since then, this number has almost doubled to a count of around 1,750 funds. At the end of 2022, assets under management in South African-domiciled open-end funds sat at just over R3 trillion. In isolation, this is already a staggering number but when we widen the timeframe to just 10 years ago, it has since increased roughly threefold. Set against the backdrop of a decade of unexciting and pedestrian domestic asset class returns, the local fund industry has continued to grow both in assets and the sheer number of options that are out there for investors. This article aims to pick through some of the noteworthy trends observed in South African fund flow data over the last ten years.

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