The mutual fund industry returned to grow in 2021 after several years of redemptions. The total fundraising volume amounted to about NIS 40 billion (along with profits of about NIS 30 billion), while the traditional funds (under active management) stood out with about NIS 25 billion. On the other hand, the monetary funds that are no longer attractive in the current interest rate environment have lost NIS 6 billion. Passive funds (monitoring indices) The global trend of sticking to indices continued to grow, with the industry as a whole growing to close to NIS 10 billion, but due to regulatory changes, funds were transferred from mutual funds to imitation funds that raised NIS 12 billion.
Mutual funds are the public’s popular investment instrument for the short and medium term. They have several inherent advantages such as diversifying an investment across a large number of securities, management by experts of investment bodies, ability to enter in any amount and ability to exit at any point in time. Funds have in recent years suffered from competition from savings policies that are aggressively marketed by insurance agents (who receive a fat commission) and an investment provident fund, but due to the higher transparency in the funds, the faster mobility and benefits mentioned, are still attractive to the general public.
Leading in the fund industry – Best, Magic and Tower
The leading body in the volume of managed assets is the best with about NIS 64 billion, but it should be remembered that about NIS 4.5 billion is in mutual funds (which also do not really have management fees). Magic of Excellence with NIS 56.1 billion and leadership in the field of passive funds, this year enjoyed net fundraising of NIS 3.1 billion and a third capital market tower in the volume of assets under management – about NIS 51 billion, but first in fundraising with NIS 9.2 billion. 
Also prominent this year were fundraisers – Moore with NIS 3.5 billion, Yellin Lapidot with NIS 2.2 billion and Psagot, which passed into the hands of Rani Zim with NIS 1.5 billion. On the other hand, they lost this year – Altshuler Shaham with redemptions of NIS 1.4 billion and Harel with redemptions of NIS 1.3 billion.
Yellin Lapidot is a leader in traditional funds
The traditional funds in which the money is actively managed led this year in raising NIS 25 billion, with the public preferring mixed funds – a high component of bonds alongside shares. These funds raised about NIS 20 billion. On the other hand, foreign funds raised a particularly low amount – about NIS 100 million, and this reflects the change that took place this year – the relative attractiveness of the local stock exchange abroad.
Prominent in the traditional funds – Yellin Lapidot with NIS 28.3 billion and fundraising of NIS 2.2 billion followed by volumes – best alongside Altshuler. Prominent in fundraising – Migdal with NIS 6 billion raised to NIS 15.2 billion.
Passive funds – magic in the head
The public has a number of options to be exposed to investments. One is to choose an investment manager who he believes will give him an excess return and another is to believe that in the end it is difficult and not even possible to usually hit the market and therefore invest in index-tracking instruments. The advantage inherent in investing in index-tracking instruments is the low management fee. Simple – there is nothing to manage and respectively the management fee is low. This is not to say that there are no excellent managers who give an excess return. The problem is that it is not certain that it will continue in the future and the second problem is that the management fee gnaws at the yield, so it is not at all clear that over time a “winning horse” can be chosen.
When talking about index-tracking instruments there are two types of funds – mutual funds and imitation funds. They are also called passive funds and although they are “close sisters”, there are some differences – imitation funds are mutual funds for all intents and purposes and are not traded on the stock exchange. Mutual funds are traded on the stock exchange like any other security (and have a market maker). In imitation funds, the true fair price is set daily, according to which the transactions are carried out. In mutual funds because they are traded on the stock exchange they also depend on demand and supply and there may be some change between the fair price and the transaction price. In any case, these are similar instruments that are growing in size in the market and constitute close to 40% of the entire fund industry.
In the passive fund industry, Kesem is a leader with assets of NIS 41.5 billion. It is followed by Meitav and Migdal quite often with NIS 34.8 and 33.4 billion. Migdal leads with NIS 3.4 billion, followed by Psagot with NIS 2.6 billion and Moore with NIS 2.4 billion.
Comments on the article(0):
Your response has been received and will be published subject to system policies.
Thanks.
For a new response
Your response was not sent due to a communication problem, please try again.
Return to comment
.