Australian investors have become more rattled by market volatility during Q3, according to the latest Fund Flow Index from Calastone. 

Managed equity funds saw inflows of just $705 million in Q3, down 81 per cent year-on-year, the worst Q3 on Calastone’s five-year record. 

Calastone said all the buying was focused in July, which saw inflows of $844 million, as the stock market rallied modestly during the month, yet by August, buying had turned to selling, and outflows continued through to the end of the quarter. 

It said funds investing in domestic equities funds saw inflows of $306 million, while overseas-focused funds saw outflows of -$77 million. 

Infrastructure funds attracted the most inflows in Q3, attracting $470 million. 

Calastone said fixed-income funds saw large inflows before buying petered out in September as bond markets faltered. 

Property funds saw their worst quarter on Calastone’s record. 

It said multi-asset funds fell firmly out of investor favour, losing $288 million over the quarter.