Assets under management in the European investment fund industry

Net assets of investment funds domiciled in Europe, UCITS and AIFs, totalled EUR 21.9 trillion at the end of 2021. Luxembourg and Ireland are the two largest domiciles of UCITS and AIFs, with a market share of 26.8% and 18.6%, respectively (2021). Germany, France and the United Kingdom follow in this ranking.


The Top 10 largest investment fund domiciles in Europe


Conventional vs. Sustainable investment funds in Europe

Europe holds 83% of global sustainable funds’ net assets, reaching almost EUR 2 trillion at the end of 2021, up 71% from 2020. Sustainable fund products reflect 16% of total net assets of funds domiciled in Europe, ahead of the US and Asia, with only 1% and 5% respectively.

As the graph below shows, Luxembourg continues to be the leading domicile for both conventional and sustainable funds. Sustainable funds accounted for EUR 664 billion by the end of 2021 followed by Ireland, Sweden and France with EUR 279 bn, EUR 213 bn and EUR198 bn respectively.  


Breakdown of net fund flows per fund domicile in Europe


Net assets under management in Luxembourg funds

Total net assets in Luxembourg investment funds hit EUR 5.9 trillion mark in December 2021.

This corresponds to a year-on-year increase of 17.8%, or 886 billion euros. More importantly, in 2021 net flows were also at record-breaking level, in excess of 30 billion euros per month. The recent crisis in Ukraine has obviously had its impact on assets under management, which stood at 5.5 billion euros at the end of April. This represents a decrease of 6.53% or EUR billion since year-end. The strong demand for Luxembourg UCITS funds and private assets (private equity, real estate and private debt), which have seen consistent growth over recent years, remains unabated.


Growth in alternative investment funds

Over the last three years, net assets under management in regulated alternative funds in Luxembourg have increased by nearly 33% (including for private equity, real estate, private debt and other alternatives such as infrastructure or hedge funds). The recent reports highlight robust growth across all asset classes for Luxembourg-domiciled funds as they become increasingly attractive outside the EU, both in terms of new AIFs set up in Luxembourg and the breadth of non-European institutional investment into these funds.  After a slow start, interest in the European Long-Term Investment Fund (ELTIF) is slowly but surely picking up with currently 68 ELTIFs in Europe. Luxembourg has positioned itself as the leading jurisdiction, with 37 ELTIFs domiciled in Luxembourg as at April 2021**.


**Source: ESMA

Growth factors in Luxembourg investment funds


Number of Luxembourg investment funds


Number of Luxembourg fund units


Legal status of Luxembourg-domiciled investment funds


Market shares of initiators by origin


Investment policy (based on assets) of Luxembourg funds as at 30 December 2021


Fund flows per asset class in 2021 compared to AUM 31 Dec. 2021 (in relative terms)