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July 18, 2018

Investors Continue to Pad the Coffers of Bond Funds and ETFs in June

by Tom Roseen.

REUTERS/Heinz-Peter Bader

For the first month in three investors were net redeemers of mutual fund assets, removing $55.2 billion from the conventional funds business (excluding ETFs) for June. For the third month in four money market funds witnessed net outflows, handing back $32.9 billion for June. Despite an interest rate hike in June, for the fourth month running the fixed income funds macro-group witnessed net inflows, taking in $10.2 billion for June. However, for the second consecutive month stock & mixed-asset funds witnessed net outflows (-$32.5 billion, their largest outflows since December 2017).

For the first month in three ETFs also witnessed net outflows, handing back $2.0 billion for June. Authorized participants (APs, those investors who actually create and redeem ETF shares) were net sellers of stock & mixed-asset ETFs—redeeming $10.0 billion. And for the thirty-sixth consecutive month they were net purchasers of bond ETFs—injecting $8.0 billion for June. APs were net purchasers of four of the five equity-based ETF macro-classifications: USDE ETFs (+$1.6 billion), Sector Equity ETFs (+$214 million), Mixed-Asset ETFs (+$123 million), and Alternatives ETFs (+$95 million), while being net redeemers of World Equity ETFs (-$12.1 billion). In this segment I highlight the June fund-flow results for both types of investment vehicles.

Highlights:

  • For the first month in three mutual fund investors were net sellers of fund assets, redeeming $55.2 billion from the conventional funds business for June.
  • For the ninth consecutive month Thomson Reuters Lipper’s World Equity Funds macro-classification witnessed net inflows, attracting however only $131 million for June.
  • For the first month in three authorized participants (APs) were net redeemers of ETFs, withdrawing $2.0 billion for June.
  • For the third month in a row U.S. Diversified Equity (USDE) ETFs (+$1.6 billion for June) attracted the largest net draw of the five broad-based equity ETF macro-classifications.

Click here to download the June 2018 FundFlows Insight Report: Investors Continue to Pad the Coffers of Bond Funds and ETFs in June.

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