Long-Term Funds Lose Billions in July

August 29, 2008 (PLANSPONSOR.com) - That great sucking sound you heard in July appears to have been money fleeing mutual fund investments.

In fact, so-called long-term funds – basically anything other than money market funds – had a net outflow of $26.04 billion in July, compared with a modest inflow of $436 million in June (see  Mutual Fund Assets Drop 5% in June ).

Most of that came from stock funds, which posted an outflow of $26.36 billion in July, compared with an outflow of $4.82 billion in June.   Among stock funds, world equity funds (US funds that invest primarily overseas) – which have in many months continued to attract new money even when domestic funds didn’t – posted an outflow of $7.67 billion in July, well ahead of June’s outflow of $1.20 billion.   Funds that invest primarily in the US had an outflow of $18.69 billion in July, also well up from the $3.63 billion outflow

Hybrid funds posted an outflow of $1.47 billion in July, compared with an inflow of $697 million in June.

Exception Move

Bond funds was the exception to the month’s trend – but the $1.79 billion July inflow was well off the $4.56 billion pace in June.

As for where all that money was flowing to, money market funds enjoyed an inflow of $79.44 billion in July, more than reversing June’s $75.89 billion outflow.   Funds offered primarily to institutions had an inflow of $56.38 billion, with the remaining $23.06 billion attributable to funds offered primarily to individuals.

Taxable bond funds had an outflow of $689 million in July, vs. an inflow of $1.94 billion in June, and municipal bond funds had an inflow of $2.48 billion in July, compared with an inflow of $2.62 billion in June.

Total Net Assets of Mutual Funds
(billions of dollars)

 

style="TEXT-ALIGN: right"> July 08

style="TEXT-ALIGN: right"> June 08

style="TEXT-ALIGN: right"> % chg

style="TEXT-ALIGN: right"> Dec 07

Stock Funds

style="TEXT-ALIGN: right"> 5,685.6

style="TEXT-ALIGN: right"> 5,845.9R

style="TEXT-ALIGN: right"> -2.7

style="TEXT-ALIGN: right"> 6,521.4R

Hybrid Funds

style="TEXT-ALIGN: right"> 663.7

style="TEXT-ALIGN: right"> 674.9R

style="TEXT-ALIGN: right"> -1.7

style="TEXT-ALIGN: right"> 713.4R

Taxable Bond Funds

style="TEXT-ALIGN: right"> 1,365.3

style="TEXT-ALIGN: right"> 1,371.9R

style="TEXT-ALIGN: right"> -0.5

style="TEXT-ALIGN: right"> 1,305.1R

Municipal Bond Funds

style="TEXT-ALIGN: right"> 385.6

style="TEXT-ALIGN: right"> 384.2R

style="TEXT-ALIGN: right"> 0.4

style="TEXT-ALIGN: right"> 373.8R

Taxable Money Market Funds

style="TEXT-ALIGN: right"> 2,988.5

style="TEXT-ALIGN: right"> 2,905.7R

style="TEXT-ALIGN: right"> 2.8

style="TEXT-ALIGN: right"> 2,642.1R

Tax-Free Money Market Funds

style="TEXT-ALIGN: right"> 498.9

style="TEXT-ALIGN: right"> 496.6R

style="TEXT-ALIGN: right"> 0.5

style="TEXT-ALIGN: right"> 465.1R

Total

style="TEXT-ALIGN: right"> 11,587.6

style="TEXT-ALIGN: right"> 11,679.1R

style="TEXT-ALIGN: right"> -0.8

style="TEXT-ALIGN: right"> 12,020.9R

R=Revised data

Net New Cash Flow of Long-Term Funds
(millions of dollars)


Stock Mutual Funds


 

style="TEXT-ALIGN: right"> July 2008

style="TEXT-ALIGN: right"> June 2008

style="TEXT-ALIGN: right"> YTD 2008

style="TEXT-ALIGN: right"> YTD 2007

New Sales

style="TEXT-ALIGN: right"> 108,029

style="TEXT-ALIGN: right"> 109,478R

style="TEXT-ALIGN: right"> 846,034

style="TEXT-ALIGN: right"> 898,199

Redemptions

style="TEXT-ALIGN: right"> -126,394

style="TEXT-ALIGN: right"> -111,938R

style="TEXT-ALIGN: right"> -854,270

style="TEXT-ALIGN: right"> -778,834

Exchanges In

style="TEXT-ALIGN: right"> 16,620

style="TEXT-ALIGN: right"> 13,712R

style="TEXT-ALIGN: right"> 111,239

style="TEXT-ALIGN: right"> 136,874

Exchanges Out

style="TEXT-ALIGN: right"> -24,618

style="TEXT-ALIGN: right"> -16,074R

style="TEXT-ALIGN: right"> -150,307

style="TEXT-ALIGN: right"> -159,059

Net New Cash Flow

style="TEXT-ALIGN: right"> -26,362

style="TEXT-ALIGN: right"> -4,822R

style="TEXT-ALIGN: right"> -47,304

style="TEXT-ALIGN: right"> 97,180


Hybrid Mutual Funds

New Sales

style="TEXT-ALIGN: right"> 14,389

style="TEXT-ALIGN: right"> 12,900R

style="TEXT-ALIGN: right"> 99,520

style="TEXT-ALIGN: right"> 94,629R

Redemptions

style="TEXT-ALIGN: right"> -14,713

style="TEXT-ALIGN: right"> -11,843R

style="TEXT-ALIGN: right"> -89,272

style="TEXT-ALIGN: right"> -78,055R

Exchanges In

style="TEXT-ALIGN: right"> 2,047

style="TEXT-ALIGN: right"> 1,229

style="TEXT-ALIGN: right"> 12,255

style="TEXT-ALIGN: right"> 12,006R

Exchanges Out

style="TEXT-ALIGN: right"> -3,189

style="TEXT-ALIGN: right"> -1,589

style="TEXT-ALIGN: right"> -15,941

style="TEXT-ALIGN: right"> -11,324R

Net New Cash Flow

style="TEXT-ALIGN: right"> -1,467

style="TEXT-ALIGN: right"> 697R

style="TEXT-ALIGN: right"> 6,562

style="TEXT-ALIGN: right"> 17,256R


Taxable Bond Mutual Funds

New Sales

style="TEXT-ALIGN: right"> 35,122

style="TEXT-ALIGN: right"> 36,812R

style="TEXT-ALIGN: right"> 298,473

style="TEXT-ALIGN: right"> 248,721

Redemptions

style="TEXT-ALIGN: right"> -38,258

style="TEXT-ALIGN: right"> -35,200R

style="TEXT-ALIGN: right"> -249,927

style="TEXT-ALIGN: right"> -179,695

Exchanges In

style="TEXT-ALIGN: right"> 7,263

style="TEXT-ALIGN: right"> 4,790R

style="TEXT-ALIGN: right"> 51,095

style="TEXT-ALIGN: right"> 40,698

Exchanges Out

style="TEXT-ALIGN: right"> -4,817

style="TEXT-ALIGN: right"> -4,460R

style="TEXT-ALIGN: right"> -33,569

style="TEXT-ALIGN: right"> -32,751

Net New Cash Flow

style="TEXT-ALIGN: right"> -689

style="TEXT-ALIGN: right"> 1,942R

style="TEXT-ALIGN: right"> 66,074

style="TEXT-ALIGN: right"> 76,973


Municipal Bond Mutual Funds

New Sales

style="TEXT-ALIGN: right"> 8,737

style="TEXT-ALIGN: right"> 9,039

style="TEXT-ALIGN: right"> 60,542

style="TEXT-ALIGN: right"> 52,199

Redemptions

style="TEXT-ALIGN: right"> -6,710

style="TEXT-ALIGN: right"> -6,692R

style="TEXT-ALIGN: right"> -44,363

style="TEXT-ALIGN: right"> -38,286

Exchanges In

style="TEXT-ALIGN: right"> 1,461

style="TEXT-ALIGN: right"> 1,282

style="TEXT-ALIGN: right"> 12,646

style="TEXT-ALIGN: right"> 7,728

Exchanges Out

style="TEXT-ALIGN: right"> -1,007

style="TEXT-ALIGN: right"> -1,009

style="TEXT-ALIGN: right"> -8,973

style="TEXT-ALIGN: right"> -7,237

Net New Cash Flow

style="TEXT-ALIGN: right"> 2,481

style="TEXT-ALIGN: right"> 2,619R

style="TEXT-ALIGN: right"> 19,852

style="TEXT-ALIGN: right"> 14,405

Net New Cash Flow of Money Market Funds
(millions of dollars)

style="TEXT-ALIGN: right"> July 08

style="TEXT-ALIGN: right"> June 08

style="TEXT-ALIGN: right"> YTD 2008

style="TEXT-ALIGN: right"> YTD 2007

style="TEXT-ALIGN: right"> 79,443

style="TEXT-ALIGN: right"> -75,889R

style="TEXT-ALIGN: right"> 314,808

style="TEXT-ALIGN: right"> 199,897

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