Israeli Mutual Funds Reach 849.4 Billion Shekels in Assets Amid Record Inflows
Israel's mutual fund industry reached 849.4 billion shekels in managed assets following 6.4 billion shekels in net inflows in September 2026, driven by money market and local bond funds.
The Israeli mutual fund industry continues to break records, posting impressive growth with net inflows of approximately 6.4 billion shekels in September 2026, bringing total net inflows since the beginning of the year to about 53.5 billion shekels.
Asset Growth and Market Drivers
As of the end of September, assets under management in active and passive funds stood at approximately 849.4 billion shekels, marking a half-year surge of about 97.1 billion shekels compared to the end of 2025. The primary growth engine since the beginning of the year continues to be money market funds, which attracted about 30.8 billion shekels in net inflows, including roughly 3.6 billion shekels in September alone. Meanwhile, funds investing in local bonds saw robust demand, pulling in around 1.5 billion shekels net in September and reaching roughly 26 billion shekels net since the start of the year.
Foreign equity sectors also recorded positive capital flows, bringing in about 1.3 billion shekels net in September and roughly 2.4 billion shekels net year-to-date. Demand for passive products was primarily directed at the S&P 500 index, which drew about 866 million shekels net during the past month. In contrast, the local stock market continued to suffer from redemptions, with active and passive funds investing in Israeli equities registering net outflows of approximately 104 million shekels in September and 6.5 billion shekels year-to-date.
Banking Index Outflows and Currency Trends
Particular weakness was observed in the banking index, which saw net redemptions of about 760 million shekels in September and massive outflows totaling roughly 12.1 billion shekels since the beginning of the year. Conversely, broader Tel Aviv Stock Exchange equity indices, excluding banks, recorded net inflows of approximately 764 million shekels in September, led by the TA-125 and TA-90 indices.
During September, the Tel Aviv Stock Exchange launched the TAF (Tel Aviv Funds) index family, featuring 14 benchmark indices for active funds covering about 77% of industry assets, aimed at enhancing market transparency and comparability. In the foreign exchange market, the shekel displayed mixed trends in September, with the representative exchange rate for the dollar ending the month at 3.063 shekels, representing a 1.7% monthly increase but a 3.7% decline year-to-date. The euro traded at 3.475 shekels, down 0.5% for the month and 6.9% for the year, while the British pound stood at 4.060 shekels, down 0.4% in September and 5.2% since January.
