Investing February 26, 2003

Assets Flow Into Funds at Start 2003

February 26, 2003 (PLANSPONSOR.com) - January reversed December's downward spiral in mutual fund flow with net inflows of $14.5 billion for stock and bond funds.
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Leading the charge was the $6.8 billion taken in by corporate bond funds and an additional $4.7 billion that was accumulated in government bond funds.   The remaining categories also all recorded inflows, with domestic equity and international/global bond funds each taking in $1.4 billion and tax-free bond funds amassing $203 million, according to an FRC report.

The $14.5 billion inflow was a welcome change after December’s $169-million outflow (See  December Dreary For Fund Flows), but paled in comparison to last January’s $31.6 billion deluge of inflows.

Picking up where 2002 left off, January was good to bond funds.   In terms of net flows, four of the top five Morningstar fund categories belonged to bond funds.  Intermediate-term bond funds led the charge, accumulating $3.9 billion in January. 

Following up this performance was the list’s lone non-pure bond representative, domestic hybrid funds with a net flow of $2.5 billion.   Rounding out the top five was short-term bond funds with $2.1 billion inflow and ultra short and high-yield bond funds – both adding $1.5 billion.

All In The Family

The Vanguard Group and Fidelity Investments were once again head of the class in terms of total assets, with $467 billion and $455 billion, respectively.  Behind the two sizeable fund families in the total asset race were:

  • American Funds – $322 billion
  • Franklin Distributors Inc – $148 billion
  • Putnam Investments – $129 billion

However, the January best-sellers list painted a slightly different picture. American Funds did the best among fund groups, recording net flows of $3.8 billion, with PIMCO funds gaining $3.3 billion.  Rounding out the top five in monthly net inflows were:

  • Vanguard Group – $2.6 billion
  • Dodge & Cox – $1.1 billion
  • Evergreen Investments – $981 million

Fund Winners

Among individual funds, PIMCO Total Return maintained the crown, besting its peers among January’s net flows with $2.1 billion, obliterating January’s silver medal winner, American’s Growth Fund, with $748 million.  Coming in third was ING Principal Protection adding $662 million, followed by Evergreen’s Adjustable Rate Fund acquiring $661 million for the month. 

Excluded from the report is all data from money market funds.

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