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April 02, 2015

Washington, D.C., April 2, 2015 - Global mutual fund and ETF investors reduced exposure to ' emerging market equities and fixed income securities in March, according to the IIF's latest Trends in Invesment Fund Portfolio Allocation.'

"The strength of the U.S. dollar and uncertainty about how-and when-the Fed will engineer an increase in the Fed funds rate is keeping all eyes on emerging markets.'  In March, portfolio allocations to emerging market assets were reduced to their lowest level since 2009, while global investors increased allocations to U.S. bonds and Euro Area equities," said Sonja Gibbs, director of capital markets and emerging markets policy at the IIF. "However, while overall allocations to emerging market assets have fallen, we are seeing continued differentiation-India, Indonesia, and the Philippines have seen big increases in portfolio allocations during the first quarter of 2015, while weightings for Brazil, Russia, and Mexico have declined."

The IIF also noted that:

  • Despite robust gains in Chinese equity markets in recent months, global investors have reduced portfolio weightings for China-highlighting the key role of domestic Chinese investors in the market rally.
  • Global fund investors continued to cut exposure to Euro Area bonds in March. Around one-fourth of the region's $6.7 trillion government debt securities are now trading at negative yields, helping explain the marked decline in fund investors' allocation to Euro Area bonds.'  Conversely, portfolio allocations to Euro Area equities rose, helped both by the strong relative performance of Euro Area stocks and robust portfolio inflows.
  • As the ECB continues its QE program, Euro Area investors have been increasing exposure to higher-yielding U.S. bonds, and to a lesser extent to emerging market bonds.'  However, Euro Area allocations to emerging market equities continue to decline.'


The Institute of International Finance is the global association of the financial industry, with close to 500 members from 70 countries. Its mission is to support the financial industry in the prudent management of risks; to develop sound industry practices; and to advocate for regulatory, financial and economic policies that are in the broad interests of its members and foster global financial stability and sustainable economic growth. Within its membership IIF counts commercial and investment banks, asset managers, insurance companies, sovereign wealth funds, hedge funds, central banks and development banks. For more information visit www.iif.com.

Media Contacts

Dylan Riddle

Tel: +1 202.857.3626

Email: driddle@iif.com