5 Best Global Equity Mutual Funds To Buy In 2018

According to Lipper’s latest fund flow report, stock funds investing globally registered strong inflows in 2017. In contrast, domestic equity funds registered outflows during the same period. Investors increasingly shifted their focus from domestic equity funds to global equity funds in 2017 and will keep a close watch on international funds this year.

Moreover, recently released economic data indicates that the world’s major economies, including China and the Eurozone, are gathering pace. Given that these are engines for the global economy, this is a positive development. Global mutual funds are excellent options for those looking to widen exposure across countries in 2018.

Investors Switch to Global Funds

As per Lipper’s fund flow report released on Jan 3, 2018, domestic equity-based funds witnessed estimated outflows of $23.4 billion in 2017. In contrast to domestic funds, their global counterparts registered inflows of $165 billion during the same period. Further, equity fund flows were mixed. Total inflows in international equity funds reached $1.318 billion while domestic equity funds posted outflows of $532 million.

As per the latest ICI weekly fund flow report, fund investors ended 2017 just as they had started the year. For the week ended Dec 27, stock funds managed to attract $4.1 billion, with around 70% of the amount being invested in global stock funds, which registered inflows for 56 consecutive weeks.

Why Buy Global Equity Funds?

If selected carefully, global mutual funds have the potential to offer secure and attractive investment opportunities. Following, a steady decline in inflows in U.S. equity funds, investors might consider a globe approach for their portfolio.

Global stocks gained recently after business activity in China and the Eurozone picked up in the last month of 2017. China’s Caixin China General Services Business Activity advanced from 51.9 in November to 53.9 in December, reaching its highest level since August 2014. Additionally, the Caixin Composite Output Index rose from 51.6 in November to 53.00 in December, indicating the fastest growth in a year. Also, the Final Caixin/Markit manufacturing PMI for December was 51.5, reaching a four-month high.