Equity funds saw an inflow of $18.8 billion in June, compared to outflows of $8.2 billion in fixed income funds and $21.8 billion in money market funds. As dire as bond outflows may appear for the month, it was a significant improvement from May’s $11.5 billion monthly outflow, according to an analysis by Lipper Inc.
Leading the push into equity funds in June was US Diversified funds’ $9.8 billion inflow. This was followed by inflows of $5.1 billion into mixed equity funds, $3.5 billion into world equity funds $0.3 billion into sector equity funds and $0.1 billion into S&P 500 Index funds.
Most of the improvement in US Diversified Equity fund flows – last month the group had an inflow of $700 million – came in conservative investments such as multi-cap funds (with a $3-billion flow increase), Mid-cap Core and Value funds which saw a $2.1 billion improvement in flows, and Small-cap Core funds (where flows improved $1.4 billion). Lipper said the movement was indicative of the flows seen during the past several months, in which “value has trumped growth and multi-cap has beaten other capitalizations as the place to be.”
Among bond funds, the lion’s share of the outflows were in short & intermediate bond funds, losing $4.4 billion, followed by the $3.8 billion outflow of long-term bonds. Looking to bond funds, Lipper characterized June’s outflow “not so much a turn-around as a lessening of negative flows.” This “improved” performance Lipper attributed to rising risk tolerance among investors.
A copy of the full report is available at http://www.research.lipper.wallst.com/researchseries/fundMarketOverview.asp .