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Cash-rich Australian investors ploughed record new capital into managed funds in 2021

Fund Flow Index - January 2022

Australian investors ploughed almost three times as much cash into managed equity funds in 2021 as they did in 2020, according to our latest Fund Flow Index. They also more than doubled their subscriptions for fixed income funds. Across all asset classes, inflows soared 162% to A$35.7bn, up from A$13.6bn in each of the previous two years. Record inflows in Q3 meant the quarter accounted for over two-fifths of the annual total. Nevertheless, inflows in the fourth quarter were also strong – at A$8.0bn, Q4 was the second-best quarter for Australian fund flows on Calastone’s record.

Key highlights from this quarter's FFI:

  • Fund inflows rose to A$35.7bn across all assets in 2021, up from A$13.6bn in 2019 and 2020
  • Equity fund inflows soared 174% to $15.0bn, up from A$5.5bn in 2020, an increase in line with global peers
  • Risk appetite peaked mid-year but waned by December as Omicron arrived
  • Australians diversified overseas, boosting inflows to international equity funds significantly
  • Small cap equity funds were also big beneficiaries of higher risk appetite in 2021
  • Fixed income funds saw inflows surge until inflation concerns dampened spirits
  • Real estate fund inflows slowed sharply, but remained ahead of peers abroad