Money poured into global equity funds as investors yanked allocations from global fixed income and emerging market strategies in the week following Donald Trump's victory in the U.S. election, according to data from financial intelligence firm EPFR Global.
As global equity funds pulled in over $27 billion for the week ended November 16, global bond funds lost two-thirds of that amount, making it the second largest weekly outflow since the data provider began to track the asset class's flows in the first quarter of 2002. Money market funds lost a further $14 billion for the week.
The key themes picked up by investors heading into a Trump presidency were clearly reflected in flows as U.S. equity investments were concentrated towards financial, healthcare and industrial sectors.
These speak to the widespread belief that the President-elect will seek to boost fiscal spend, cut red tape and encourage interest rates to resume an upward trajectory.
Within the report, EPFR Global Director of Research, Cameron Brandt said, "This week's flows are certainly consistent with the narrative that Trump's policies spell reflation in the US and a lighter regulatory burden for a number of sectors."
"They are also consistent with the assumption the benefits of a hotter U.S. economy will not flow as smoothly through trade channels to other countries and regions," he added.