July 12, 2013

Lipper Fund Flows: Investors pump $8.4 billion into equity exchange-traded funds

by Jeff Tjornehoj

Global markets were reassured this week when Federal Reserve Chairman Ben Bernanke signaled that the Fed’s bond-buying program would continue, saying that a “highly accommodative policy is needed for the foreseeable future.” Recently-released minutes from the latest Federal Reserve policymakers’ meeting showed about half the members felt the bond-buying stimulus could wind down by year-end, the other half wanted reassurance that the job market is on solid ground before changing policy.

In response, equity exchange-traded fund (ETF) investors pumped $8.4 billion net into their accounts for the week ended Wednesday, July 10, the highest amount since the early-January burst. Naturally, SPDR S&P 500 ETF (SPY) collected the lion’s share, about $5.5 billion net.

ETF investors drew away from SPDR Gold (GLD) to the tune of $1.0 billion in net outflows. Equity mutual fund investors also continued to feel bullish; their $3.5 billion net inflow harkened back to the Q1 2013 euphoria. Lipper’s Emerging Markets Funds classification, with $392 million in net proceeds, was the top draw for mutual fund owners.

However, taxable bond fund investors were of two minds: mutual fund users scraped up about $219 million in net inflows for their accounts, while bond ETF investors pulled out about $456 million net—neither amount reflected a strong opinion on bonds. Municipal bond mutual funds saw their outflow problem accelerate as $1.1 billion was pulled from them during the week, and the ETF side also felt the sting when $116 million was taken from them. Money market funds saw inflows of $22.9 billion net; institutional investors pumped $23.7 billion into the system, while retail MMF owners made modest net withdrawals.

For more information on this week’s fund flows data, please refer to Lipper’s U.S. fund flows website.

 
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