The report describes how markets reached critical point in October, forcing European governments to offer a slew of rescue package as well as total or partial guarantees on bank deposit accounts.

The move prevented a rush on endangered banks but was disastrous for funds. Redemptions in October alone came to €154 billion (about $198 billion).

With all other investment and savings options in devastating decline, savers plumped for the choice that would best protect their money.

And it was, therefore, in the short-term and government bond funds that the run from funds and into deposits occurred. The fixed income sector saw redemptions of €58 billion, beating last month’s record outflows by a factor of 2.7.

In the shorter-term money market arena, September’s drain continued with a further withdrawal of €41 billion. Institutions and retail investors alike favoured the increased safety of deposit accounts.

German funds were particularly badly hit, with fund managers watching a painful €45 billion disappear, €30 billion of it in bond and money market products. European stock markets continued to tumble during the month; a fall of 13.6 per cent on the MSCI Europe gave further fright to the buy-and-hold investors that had not taken profits in earlier months.

The result was a withdrawal of another €22 billion, which came close to matching September’s departure. However, although wince-inducing, the withdrawal was less than half the retreat posted in January.

ETFs acted as a benevolent influence on the equity total, offsetting €4.5 billion of the outflows but there remained a number of actively managed sectors in demand, particularly those offering exposure to local stocks which some investors now believe are oversold.

Lipper found that the group with the strongest net flows was Barclays, with inflows of €1.8 billion, thanks to ETF support.