Published on 17 Aug 2012 by Tom Roseen

Despite the sluggishness in the market, investors were net purchasers of fund assets and injected $11.2 billion into the funds business (including open-end funds and ETFs). However, as one might expect given the uncertainty of the equity market, equity funds witnessed $6.3 billion in net redemptions, while money market funds (+$13.5 billion), taxable bond funds (+$3.0 billion), and municipal bond funds (+$1.0 billion) experienced net inflows. For the second consecutive week equity ETFs suffered net redemptions and handed back some $4.4 billion. Just two funds accounted for the majority of outflows: the SPDR S&P 500 ETF (-$3.1 billion) and the iShares Russell 2000 Index (-$1.0 billion). Excluding ETFs, for the third week in four equity funds witnessed net redemptions (-$1.8 billion) as domestic equity funds suffered $2.0 billion in net redemptions and non-domestic equity funds took in a little less than $150 million. Investors’ predilection for dividend paying mutual funds (ex-ETFs) continued, as equity income funds attracted $159 million and real estate funds took in $122 million. Despite declining yields and ignoring the quasi-flight to safety toward week end, open-end fund investors injected $1.2 billion into corporate investment-grade debt funds, $464 million into corporate high-yield debt funds, and $360 million into government/mortgage funds. For the 18th consecutive week, municipal debt funds experienced net inflows, this time for $0.9 billion.Tom Roseen discusses Lipper's U.S. weekly fund flows.

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