Investors are losing confidence in Europe’s large investment funds. Since the beginning of the year, institutions have seen a record outflow of money. Clearly, they have experienced that more than once. This time, however, this is due to the fact that investors are losing trust.
In most cases, especially when money is involved, the loss of trust is a death sentence. Having received such a black mark, banks, hedge funds, and other financial institutions may vanish because reputation and trust are as important as profits here. Many European funds are at risk this year. The outflow of capital has reached record levels. Since the beginning of the year, investors have withdrawn more than $27 billion, naming the loss of confidence as the main reason for their actions in surveys.
Bloomberg, citing Bank of America Corp, reports that the region's equity funds have been suffering from an outflow of investments for sixteen straight weeks, having lost billions of dollars. Between June 19 and June 25, Europe saw the biggest outflow of $4.6 billion. Analysts stress that investors are now giving preference to US funds.
Earlier, Ludovic Subran, the chief economist at German insurance company Allianz, said investors should brace for months of a correction in the market and warned of a new financial disaster.
