Year in figures

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Luxembourg is the number one hub for global cross-border fund distribution. It is the largest fund centre in Europe and second-largest in the world.

 

Assets under management in the European investment fund industry

 

The 10 largest investment fund domiciles in Europe as at 31 December 2017

  

The European fund industry has experienced year-on-year growth in net assets since 2012, and 2017 was no exception. In fact, 2017 was remarkable, with net assets of UCITS and AIF surpassing the EUR 15 trillion mark. There were EUR 15,623.1 billion in assets under management at the end of 2017 thanks to 10.1% growth during the year, boosted by net sales of UCITS and AIF. Net sales reached their highest level ever (EUR 949 billion). UCITS accounted for 62.2% of this total, with the remainder being AIFs. Luxembourg remains the leading fund domicile in Europe, with a market share close to the combined total for Ireland and Germany, the countries placed second and third.

 

Net assets under management in Luxembourg funds

  

2017 was an exceptional year for the Luxembourg fund industry. Assets under management posted all-time records month after month, except for a slight contraction in June, pushing them over the EUR 4 trillion threshold in September, barely three years after passing the EUR 3 trillion mark.

 

Growth factors in Luxembourg investment funds

 

As at 31 December 2017, total net assets of Luxembourg investment funds were up by EUR 418,284 million from the end of 2016 to EUR 4,159.614 billion. In absolute terms, annual growth more than doubled from 2016, with an increase of 111%.

With an annual growth rate of 11.18%, net assets of UCIs ended the year at an absolute record level. Net sales (EUR 308,365 million) played a large part in this boost together with the evolution of the financial markets (EUR 109,919 million) to make it the third-best year after 2014 and 2005.

 

Number of Luxembourg investment funds (legal entities)

    

 

Number of funds registered on or withdrawn from the CSSF list since 2000 

 

   

 

Number of Luxembourg fund units

 

   

4,044 funds were domiciled in Luxembourg at the end of 2017. This is a decrease from 2016, with 227 new funds launched and 327 withdrawn. There were 14,728 fund units at the end of the year, corresponding to a net annual increase of 0.91%, higher than in 2016.

 

Legal status of Luxembourg-domiciled investment funds

39.2% of all new funds created were SIFs, confirming the continued success of this product since it was introduced in 2007. At the end of March 2018, SIFs accounted for 39% of the number of funds on the Luxembourg market, as they did in 2016. The SICAV has been the most popular structure since 2012. At the end of March 2018 it accounted for 54.5% of funds, compared to 37.2% represented by the once-dominant FCP.

 

Market shares of initiators by origin at 31 December 2017

 

The top ten initiators of Luxembourg UCIs by geographical origin remained unchanged in 2017.

The US remained number one with 20.5%, but its market share fell for the sixth year running. The UK was next with 17.6% following six years of growth. Germany (14.6%) ranked third, followed closely by Switzerland (13.6%), which stabilised its share in 2017 after previous declines. All top ten countries of origin saw growth in net assets, with promoters from the UK enjoying particularly strong growth of 14.5% compared with 6.4% for Italy-based initiators. Danish initiators saw the highest percentage increase (20%), albeit from a lower base. In terms of fund numbers, German initiators have held the top spot since 2007, but the Swiss, after 11 years of trailing, are back in first place in terms of fund units with a number of 2746 (compared with 2702 German-origin fund units).

 

Investment policy of Luxembourg funds at 31 December 2017

 

 

 

Investment policy of Luxembourg funds at 31 December 2017

 

Equity and bond funds together represented 59.5% of total net assets at the end of 2017.

In terms of volume, equity funds had the strongest year-on-year growth in 2017, with an increase of EUR 158,522 million or 14.7%, EUR 45,716 million of which net investment in capital. The number of fund units increased significantly, with a net variation of +2%, standing at 3,838 at the end of 2017. Bond funds and balanced funds follow, with increases in volume of EUR 101,199 million and EUR 111,542 million respectively. Bond funds saw their market share fall by nearly 0.6 pp in terms of net assets during the year, despite net inflows posting 38.6% (EUR 119,135 million) of total net sales in UCIs. They ended the year at EUR 1,236.308 billion.

Balanced funds registered a growth rate of 14%, bringing net assets to EUR 909.527 million at year-end 2017. Not only did they represent 27.3% of the total number of fund units (4,021 out of 14,728) but they also accounted for 29.2% of annual net inflows or EUR 90.184 billion in UCIs.

As at 31 December 2017, net assets of SIFs amounted to EUR 472,415 million, representing more than 11% of the total Luxembourg UCI sector. They posted an annual growth of 11.3%, which was slightly above that of the funds industry as a whole (11.18%) and accounted for 9.6% of annual net inflows (EUR 29,537 million).

 

Fund flows per asset class in 2017