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Swiss Funds Show Strength, Alternatives Shine

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The Swiss fund market posted a strong increase in assets under management in the first quarter of 2006, according to data released yesterday by the Swiss Funds Association.

Assets under management at funds covered by the statistics increased by 6.7%, or 35.8 billion CHF, to a record high of 572 billion CHF. Equity funds had a particularly strong quarter, with AUM increasing by 10.2% or 17.3 billion to 185.7 billion CHF. Market performance accounted for 14.6 billion CHF of the increase, with 2.1 billion coming from inflows to equity funds.

Bond funds and asset allocation funds were the main beneficiaries of inflows, attracting 4 billion CHF and 3.9 billion respectively in new money. Market performance added another 2.1 billion to bond fund AUM, bringing the total increase to 6.1 billion CHF, or 4.1%. Performance also boosted asset allocation funds AUM by 2.9 billion, or 3.68%.

The ‘other funds’ category, consisting mainly of funds for alternative investments–including hedge funds but excluding real estate funds–or those with particular investment policies had a very strong quarter in terms of both performance and inflows. AUM leapt by 25.45% or 7.1 billion CHF to 34.6 CHF. Market performance accounted for a 3.4 billion CHF increase, while total inflows amounted to 3.7 billion CHF.

However, the true size of this asset class is probably much greater than that reported by the SFA, “given that there are likely to be further considerable holdings in funds that are not offered publicly and therefore not covered by this statistic,” according to the SFA release.

The data were provided by ‘TIF–Transparency in the Fund Market’, a fund database jointly launched by the Swiss Funds Association and the Swiss Exchange.

Contact Bob Keane with questions or comments at [email protected].