Equity/Balanced mutual funds recorded a net new flow of $36 billion in April, according to data complied by Strategic Research. These totals include equity and balanced open-end funds, closed-end funds, funds underlying variable annuities, and index mutual funds including exchange-traded funds (ETFs), the research firm for the mutual fund and wealth management industry said in a news release.
Not faring so well however were bond funds, which experienced a negative net flow of $6 billion. This brought the aggregate net flow across all mutual fund types to $30 billion in April, Strategic found.
“The Tsunami pace of investors’ new commitments, coming during a year of disappointing returns, lingering regulatory attention, and world turmoil, reflects strong, underlying personal confidence in the long-term rewards of investing. It also affirms the premier role of mutual funds as the vehicle for retirement planning, which accounts for about two-thirds of equity fund assets,” commented Avi Nachmany, Strategic’s Director of Research.
Going forward, Strategic anticipates more growth. “While sharply falling stock prices lately temporarily slowed equity fund inflows, once stock markets stabilize, rebounding investor and economic confidence are likely to again trigger massive new investments in stock mutual funds,” Nachmany said. Strategic projects Equity/Balanced funds will see an $18 billion net new flow in May.