Inflows into open-ended and ETP products rise $300bn

There has been a $300bn rise in the amount invested in both mutual and passive funds globally in 2014, data from Morningstar shows.

The data giant’s 2014 Global Flows Report said a record net inflow of $1.3trn was invested in open-ended and exchange-traded products (ETPs).

Global equity funds accounted for almost a third of this amount at $439bn, the report said.

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At the end of 2014, global open-end and ETP assets stood at nearly $30trn, up from $27trn in 2013.

The report confirmed Vanguard’s success in 2014 as the fund manager led firm-level inflows, almost reaching $3trn in assets.

The world’s largest provider of mutual funds and the second-biggest provider of ETP’s also grew its business on the active side, becoming the third-largest active manager in the world with assets worth in excess of $900bn.

The report revealed alternative funds had the highest organic growth rate. But despite being the fastest-growing category just a few years prior, commodity-based funds had another difficult year. Morningstar largely attributed this to the falling price of oil.

The company added that while there was a clear preference for less-expensive, passively managed index funds in the US, the “same cannot be said for Europe and Asia, as non-index funds remain the selected method for investing”.