Investing February 20, 2004

Equities Blaze the UIT Trail in January

February 20, 2004 (PLANSPONSOR.com) - Leaning on the back of particularly strong equity inflows, assets poured into unit investment trusts (UIT) in January 2004.
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UITs, investment companies that hold fixed portfolios of selected stocks or bonds, had total deposits of $1.91 billion in January, up 40.4% from the $1.36 billion in December deposits, according to data complied by the Investment Company Institute (ICI).

Leading the way were equity UITs, which ended January with total deposits of $1.68 billion, up 49.6% from $1.12 billion the month before.  This was followed by taxable debt UITs showing $82.9 million in January assets, up 13.5% from December’s $73 million. Meanwhile, tax-free debt UITs were in the minus column of asset flows in January, down to $142 million, losing 11.3% from the $160 million in December.

January recorded 64 new trusts issuing shares for the month.  Of that total, 38 were equity trusts, 18 were tax-free bond trusts, and eight were taxable bond trusts.

In terms of maturity, long-term bond trusts having an average weighted maturity of more than 15 years were the most commonly offered in January, with $116.9 million in shareholder deposits.

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