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August 24, 2018

U.S. Weekly FundFlows Insight Report: Funds Grow Their Coffers by Almost $10 Billion

by Patrick Keon.

Thomson Reuters Lipper’s fund asset groups (including both mutual funds and ETFs) had net inflows of $9.7 billion for the fund-flows week ended Wednesday, August 22. All four fund asset groups took in net new money for the week, paced by money market funds (+$4.2 billion) and taxable bond funds (+$3.4 billion). Equity funds and municipal debt funds contributed $1.8 billion and $378 million to the total net inflows.

Market Overview

The Dow Jones Industrial Average and the S&P 500 Index gained 2.27% and 1.54%, respectively, for the fund-flows week. Both indices recorded the majority of their gains for the week on the first trading day on the strength of a potential thaw in the trade tensions between the U.S. and China. It was announced that day that the two countries would meet for lower-level trade talks before the end of the month in hopes of heading off any further escalation of the current tariff war.

ETFs

ETFs had net inflows (+$7.2 billion) for the seventh straight week. Equity ETFs (+$4.7 billion) and taxable bond ETFs (+$2.3 billion) were responsible for the lion’s share of the net inflows, while muni debt ETFs contributed $83 million of net new money to the total. The largest individual positive net flows for equity ETFs and taxable bond ETFs belonged to SPDR S&P 500 ETF (SPY, +$1.2 billion) and iShares iBoxx $Investment Grade Corporate Bond ETF (LQD, +$848 million), respectively.

Equity Mutual Funds

Equity mutual funds (-$3.0 billion) experienced net outflows for the ninth straight week. Going against the current trend, nondomestic equity funds (-$1.7 billion) suffered larger net outflows than did domestic equity funds (-$1.3 billion). The largest net outflows among the respective peer groups belonged to International Multi-Cap Core Funds (-$1.4 billion) and Equity Income Funds (-$484 million).

Fixed Income Mutual Funds

The taxable bond (+$1.1 billion) and muni debt (+$296 million) fund groups both had net-positive flows for the week. The most significant net inflows among the two groups belonged to the Core Plus Bond Funds (+$377 million) and High Yield Muni Debt Funds (+$216 million) peer groups.

Money Market Mutual Funds

Money market funds took in $4.2 billion of net new money for the week. The largest net inflows were attributable to Institutional Money Market Funds (+$3.3 billion) and Money Market Instrument Funds (+$2.5 billion), while Institutional U.S. Treasury Money Market Funds (-$2.5 billion) had the largest net outflows.

 

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