Assets in absolute return fund sector continue to decline

Written by Adam Cadle

30/08/2023

The AuM of Europe-domiciled funds that include ‘absolute return’ in their name declined by €6.1bn during the first seven months of 2023, reinforcing suggestions that the strategy is in an ongoing decline, Cerulli has said.

The sector’s AuM fell by 30% between year-end 2013 and year-end 2022, and decreased by 55.6% between its peak year of 2015 and 2022. The erosion continued in 2023, as asset allocators switched out of absolute return strategies and into long-only global equity and fixed income.

“Performance has been another issue for absolute return funds,” Cerulli Associates director, European asset and wealth management research, Fabrizio Zumbo, said.

“In this regard, some 29% of surviving funds with absolute return in their name have delivered a negative return in the three years to end of July.”

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