10.02.2025, 13:24
Net inflows into money market funds have almost quadrupled
Source: OREANDA-NEWS
OREANDA-NEWS The net inflow of funds to Russian money market funds has almost quadrupled over the past year, and the net asset value (net asset value) of such funds has soared 92 times since January 2020. Given the high key rate of the Central Bank, investors are looking for instruments with returns comparable to deposits, but with more liquidity, and also a way to reduce inflation risks, experts from the Investment Market Research Laboratory (LIRI) commented to RIA Novosti Alfa-Capital Management Company.
"In 2024, net investments in money market funds reached 776.3 billion rubles, which is 3.7 times more than in 2023. December 2024 was a record month for the inflow of funds to money market funds (250 billion rubles). The previous record was set in October 2024, when the inflow to retail funds amounted to 139 billion rubles," experts say.
The growth of the Central Bank's key rate to 21% and the overall "harsh rhetoric" of the Central Bank of the Russian Federation regarding monetary policy have become the main drivers of this growth. "Investors are looking for instruments with returns comparable to deposits, but with more liquidity, and besides, a way to reduce inflationary risks," LEARY notes.
Not only goods have value, but also money itself, however, unlike goods, the value of money is expressed not in a fixed currency, but through interest rates — an indicator of profitability or the cost of their use: interest rates determine how much you can earn by lending money, or how much you will have to pay for their loan, they explain experts. And money market funds invest in short-term, low-risk, and highly liquid assets in order to preserve capital and generate stable income, they add.
According to the register of the Bank of Russia, the first money market fund in Russia appeared at the end of 2002 in the form of an open mutual fund (OPIFa). At the end of last year, 19 funds were registered on the OPIF and BPIF (exchange-traded) market: four OPIF and 15 BPIF. An important trend has been the doubling of the number of funds since the beginning of the increase in the Central Bank's key rate in the second half of 2023, experts say.
Before the advent of monetary mutual funds in 2020, the amount of funds managed by money market funds in the form of mutual funds usually did not exceed 1.5% of the assets of all funds, but by the end of 2024, the share of monetary funds among all mutual funds was already more than 40.6%, of which 93.6% accounted for mutual funds. As a result, the total amount of money market funds increased 92 times from 11.8 billion rubles in January 2020, to 1.086 trillion, Alfa-Capital Management Company summarizes.
"In 2024, net investments in money market funds reached 776.3 billion rubles, which is 3.7 times more than in 2023. December 2024 was a record month for the inflow of funds to money market funds (250 billion rubles). The previous record was set in October 2024, when the inflow to retail funds amounted to 139 billion rubles," experts say.
The growth of the Central Bank's key rate to 21% and the overall "harsh rhetoric" of the Central Bank of the Russian Federation regarding monetary policy have become the main drivers of this growth. "Investors are looking for instruments with returns comparable to deposits, but with more liquidity, and besides, a way to reduce inflationary risks," LEARY notes.
Not only goods have value, but also money itself, however, unlike goods, the value of money is expressed not in a fixed currency, but through interest rates — an indicator of profitability or the cost of their use: interest rates determine how much you can earn by lending money, or how much you will have to pay for their loan, they explain experts. And money market funds invest in short-term, low-risk, and highly liquid assets in order to preserve capital and generate stable income, they add.
According to the register of the Bank of Russia, the first money market fund in Russia appeared at the end of 2002 in the form of an open mutual fund (OPIFa). At the end of last year, 19 funds were registered on the OPIF and BPIF (exchange-traded) market: four OPIF and 15 BPIF. An important trend has been the doubling of the number of funds since the beginning of the increase in the Central Bank's key rate in the second half of 2023, experts say.
Before the advent of monetary mutual funds in 2020, the amount of funds managed by money market funds in the form of mutual funds usually did not exceed 1.5% of the assets of all funds, but by the end of 2024, the share of monetary funds among all mutual funds was already more than 40.6%, of which 93.6% accounted for mutual funds. As a result, the total amount of money market funds increased 92 times from 11.8 billion rubles in January 2020, to 1.086 trillion, Alfa-Capital Management Company summarizes.
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