State Street Corp.’s SPDR Trust was August’s best-selling mutual fund with US investors, according to a report by the Financial Research Corp. (FRC). The fund, usually referred to as Spiders, had net sales of $1.7 billion in the month. This is the first time that an exchange-traded fund – funds that are based on indices that enable investors to trade portfolios of stock and bonds in a single security at any time during the day – has led the mutual fund market in sales. SPDR Trust is indexed off of the Standard & Poor’s 500.
Exchange-traded funds were added to the FRCs monthly estimate of the mutual fund industry in January 2004.
Overall, the sales of stock, bond and exchange-traded funds was $13.7 billion in August. With 40% of the industry’s net inflow, American Funds led the way for the 17 th straight month, with a $5.5-billion inflow. Following this were funds offered by Vanguard, with $3.2 billion in sales. Both State Street Global Advisors and Pacific Management Co. had net inflows of $1.5 billion. Fidelity Investments had a net inflow of $98 million.
On the other end of the market, Putnam Investments, recently rocked by the SEC probe into its involvement in the mutual fund trading scandal, had a net outflow of $1.7 billion. Janus Capital Group Inc. lost $1.5 billion. Both fund companies have lost money each month since June of 2001.
International and global mutual funds had $5.1 billion in sales for the month, as US equity funds took in $4.9 billion. Corporate bond funds saw an inflow of $4.2 billion, and government bond funds saw an inflow of $894 billion for the month.
To access the report, please see http://www.frcnet.com/frc_login_netflows.asp .