Assets managed by Romanian open-ended investment funds reach EUR 5 bln, with over 755,000 investors
The number of investors in Romanian open-end investment funds like ETFs or mutual funds exceeded 755,000 people by the end of the third quarter, increasing by over 200,000 compared to last year, while the assets managed by these funds reached nearly RON 26 billion (over EUR 5 billion) within a total market of almost EUR 10 billion.
The figures were discussed at the quarterly debate organized by the Romanian Fund Managers’ Association (AAF) and the Bucharest Stock Exchange (BVB) at the BVB Amphitheater within the Bucharest University of Economic Studies (ASE). Present at the debate, fund managers explained to economics students the benefits of starting investments as early as possible, even during their studies, as well as the importance of investment regularity and duration and the market’s future outlook
Discussions took place in a context of investor optimism. Assets managed by investment funds in Romania registered an annual growth of 37% while also noting a historic high in the number of investors active through such funds. The share of equity funds has exceeded 25% of the total open-end investment fund (OEIF) market.
"Today there are over 755,000 investors in Romania's open-end investment funds, with over 200,000 more people than a year ago, and managed assets of nearly RON 26 billion, or just over EUR 5 billion. These are historic figures for open-end investment funds. These funds are accessible to everyone, meaning you can enter and exit them at any time,” said Gustă, president of the Fund Administrators Association, or AAF. He also warned the audience of people posing as investment consultants.
Analyzing the third quarter performance of OEIFs, Jan Pricop, AAF’s executive director, noted that the market is in a recovery phase compared to the end of 2022. He also said that Romania has room to grow in the sector, compared to the EU average or the US.
"We have an annual growth of 37% compared to Q3 of 2023 and slightly over 6% more than Q2, with the segment’s assets reaching RON 26 billion. Inflows in the third quarter were RON 1.27 billion, over 300% higher than the same quarter in 2023. We’ve had a substantial increase in net assets, particularly in equity funds, up 72%. Diversified funds have also seen a notable rise of 52.4%. Currently, equity funds represent 25% of the OEIF market. At the European level, this segment accounts for 33%, while in the United States, it’s over 55%. We are gradually approaching the European percentage," said Jan Pricop.
Regarding the number of investors, there was an annual increase of 39%, with the most significant growth in equity investment funds, up 74.2%. In diversified investment funds, growth was 42%, reaching a total of over 184,000 investors, while bond and fixed-income fund investors approached nearly 279,000. Quarterly net subscriptions, while lower than in Q2 of 2024, are four times higher than the same quarter last year, totaling RON 1.27 billion.
Adrian Tănase, CEO of the Bucharest Stock Exchange (BVB), highlighted that Romania still lacks a culture of stock market investment. Hence, it’s important to discuss funds and long-term, diversified investments in the public domain.
Regarding recent corrections on the Bucharest Stock Exchange due to international factors, market specialists believe they are normal and shouldn’t cause alarm. “We came off a very strong 2023 and start to 2024, with the market growing much faster than the economy, boosted by Hidroelectrica’s listing and the influx of new investors. However, this growth led to higher valuation multiples, and with the upcoming election period and uncertainty over anticipated fiscal adjustments, investors have become somewhat reserved," said Robert Burlan, Investment Director at Raiffeisen Asset Management.
Răzvan Pașol, CEO of Patria Asset Management, explained that during this period, investors displayed interesting behavior, as they not only kept their funds in place but took advantage of lower prices to buy. “This simple investment strategy has proven its value over time: if the investment is recurring, even if amounts are small, over 5-10 years it can become highly profitable," Pașol explained.
Debate participants concluded that Romania is increasingly seen as a mature market for safe investments, with Romanians becoming more interested and educated in investments. They are beginning to understand how financial markets work and act less emotionally in response to stock market fluctuations.
(Photo source: press release)
