US equity fund underperformance drives GQG outflows
Outflows of US$1.4 billion from its US equity funds have contributed to GQG Partners reporting its highest monthly outflows for 2025 in August.
In its monthly data, the firm said overall funds under management rose from US$166.6 billion to US$167.6 billion. However, it reported US$1.8 billion in outflows with all divisions apart from international equities, which saw inflows of US$100 million.
The biggest August redemptions came from its US equity division, which saw outflows of US$1.4 billion to fall from US$18.8 million to US$17.8 million.
This was the largest monthly outflows this year and followed US$1.4 billion of outflows during July after a single institutional client withdrew over US$1 billion from its global equity division. The asset manager did not offer a reason for August’s outflows, but both of its US equity funds, which aren’t available in Australia, have lagged the index.
Performance on the US Select Quality Equity Fund returned 0.3 per cent over one year to 31 July, versus returns of 16.3 per cent by the S&P 500 Index. On its US Quality Value Fund, this has also underperformed with returns of 5.2 per cent over one year versus returns of 7.8 per cent by the MSCI USA Value Index.
Emerging market equity saw outflows of US$300 million, while global equities saw US$200 million in outflows to stand at US$40.4 billion and US$39.1 billion, respectively.
Over the year to date to 31 August, total inflows are US$4.9 billion for the eight months, with international equity seeing US$3.9 billion in flows. Looking at this time period, emerging market equities were the only division to fall into outflow at US$1.2 billion.
The potential for further outflows had been flagged earlier in the year when it noted in its half-year results that it had witnessed “redemption pressure” from larger investors into its Australian and UCITS funds. This was attributed to the defensive positioning of the portfolios, which had led to underperformance.
Earlier in the year, it also launched its first ETFs in the US, which now have US$200 million and said these could be launched in Australia in due course.
“GQG’s entry into the ETF market is in recognition of the increasingly significant investor demand for this type of vehicle. By offering this strategy in an ETF format, GQG seeks to be a manager of choice for investors, diversify its product offerings for clients and tap into this growing segment of our industry,” it said in its results.
AUTHOR
Laura Dew
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