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HomeLatest NewsTreasury Bills and fixed income funds attract 28 billion retailers

Treasury Bills and fixed income funds attract 28 billion retailers

Date: July 18, 2024 Time: 14:04:24

27.8 29 million euros.

According to statistics from the association of collective investment institutions (Inverco), as of June 30, the entities that market investment funds (mostly banks) captured 13,047 million net – new subscriptions minus refunds made in the period.

The inflow of money into this type of funds has skyrocketed since last year, a year in which it marked the maximum since data were available (year 2002) with 15,237 million, a figure that is expected to be exceeded before the end of the year view of its evolution.

The latest data from Inverco, for the month of July, brings net subscriptions to 14,087 million in the first seven months of the year, barely one billion below those of all of 2022. In several months of 2023, net contributions have been above 2,000 million and none have dropped below 1,000 million.

As regards Public Treasury bills, the balance of the portfolio held by households has changed from the Bank of Spain data.

The rise in retail investment in Treasury bills has been spectacular since last summer, when the European Central Bank (ECB) began raising interest rates in the eurozone to tackle high inflation. The portfolio of retail investors in bills was only 19 million in June 2022, in October it had amounted to 321 million and ended the year at the more than 1.8 billion mentioned.

Few risk-free alternatives

State bills, which are offered in terms of three, six, nine and twelve months, have been in strong demand by households due to their high return on the risk offered by this type of investment compared to comparable products such as Bank deposits. “What we see is that there is no offer of fixed-term deposits, with which the investor with a conservative profile, which is the majority in our country, goes to the rest of the safe products and that offer profitability,” they explain from Asufin.

The basic rate of the ECB exceeds 3% since the beginning of February 2023, a rise that has been transferred to reference indices of financial products, such as the Euribor of mortgages, but there are not many bank deposits with a remuneration according to this level. “It is to be expected that at some point it will also begin to be offered by entities,” adds the consumer association.

Despite the decrease in the interest rate paid in the last auctions in August, in all terms the average rate exceeds 3.5%, above bank deposits. In the case of investment funds, the performance differs greatly between each product, since they can invest both in public debt assets (and not only from Spain) as well as bonds or other corporate debt instruments. According to the latest data from Inverco, from July, the average return for those months of fixed-income funds was 0.41% and the accumulated rate for this year was 1.53%.

Asufin recommends that investors weigh the degree of risk they want to assume when selecting investment products, require the entities with which they operate to provide all the necessary information, with the highest degree of transparency possible, and ensure that they fully understand everything that hire. When choosing intermediaries, the consumer association advises opting for those that appear in the relevant records, that are supervised by the authorities and avoid “financial beach bars” and those that offer “out-of-market returns”. .

* This website provides news content gathered from various internet sources. It is crucial to understand that we are not responsible for the accuracy, completeness, or reliability of the information presented Read More

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.

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