Well it kind of depends……
The picture for investment fund flows in Europe and the US appears reasonably positive, while stats for the UK are a bit more challenging.
Financial markets have been hit with geo-political risk, growth concerns, inflation fears and a possible end to the interest rate cycle. But generally investors seem happy to continue to put money to work.
Here in Europe, investment funds and ETFs gathered EUR 185 billion in the first quarter of 2026. This was up from EUR 154 billion in the last quarter of 2025. So Q1 was positive, despite outflows of EUR 19 billion in March, as war in the Middle East rattled markets. Equity funds gathered EUR 95 billion, a substantial increase compared with EUR 42.9 billion in the fourth quarter of 2025. Most of the equity flows were to global large-cap and emerging-market funds.
This positive tone seems to have persisted into April based on figures for ETFs.
And we are seeing this appetite to take on higher risk also in the reduction of flows into bonds. Fixed-income funds attracted EUR 63 billion, down from EUR 91 billion in the last quarter of 2025. Emerging-market bond funds, in demand for much of the past 12 months, saw outflows in March.
As an aside, passive is still winning the day in European flows. In Q1 passive gathered 65% of all flows. Active equity is still under pressure. Overall Active funds gathered EUR 64 billion of flows in the first quarter, down from EUR 80 billion in Q4 2025. And most of this “active” money is finding its way into bonds rather than equities. Active equity actually saw outflows.
Passive equity in Europe now stands at EUR 3.4 trillion compared with just over EUR 4 trillion for their active counterparts.
In the US, there was an even brighter picture in terms of flows into funds. Long-term US funds rebounded sharply in April, gathering $120 billion in new assets as investor risk appetite strengthened and markets priced in improving geopolitical conditions. March had been much lower at under $50 billion inflow.
The April result was the 12th consecutive month of inflows and, mirroring what we saw in Europe, equity funds took over from fixed income which had been leading in prior months. Flows into bonds in April were about $40 billion – one of their weakest months over the past year.
It’s been a very different story for equity investors in the UK over the. past year. Up to the end of March this year, based on retail statistics from the Investment Association, equity funds have basically been in free fall. We have seen negative flows out of equity funds in practically every month over the past year. Overall fund flows have stayed positive doe to investment in money market and bond funds.
April did see a bit of a recovery as UK investors returned to equity funds, adding a net £1.1bn.
This made April 2026 the best month for inflows since April 2025. It was quite targeted, as money flowed into Global and US stock markets but investors continued to exit Europe, Asia and Emerging Markets.
In the UK, Passive has also been the clear winner. In April, Passive funds gained £2.6 bn in assets while Active actually lost £1.6bn.
Fund investors seem reasonably confident in their outlook, both in terms of buying into funds and what asset classes they are investing in. April especially seemed to have been a better month and flows favoured equities over bonds. It probably helps that stress levels in markets were lower. The VIX index, a reasonable measure of such market stress, is currently around 16 – down from its level over 30 at the end of March.
Tradewinds 