U.S. Stock Fund Outflows May Surpass Record

Morningstar’s estimated U.S. mutual fund asset flows through November 2012 show U.S. stock funds shed another $14.1 billion in November, with particularly strong outflows from growth-oriented offerings. Active equity funds with lower expenses experienced slower outflows than higher-fee funds. Within the U.S. stock broad asset class, funds rated Gold, Silver or Bronze by Morningstar exhibited slower rates of decline than neutral- or negative-rated funds.

Investors continued to shift assets to fixed income funds, as open-end taxable-bond funds and municipal-bond funds collected $17.9 billion and $5.2 billion, respectively.

Additional highlights of the report include:

• Intermediate-term bond funds led all categories in terms of inflows for the sixth month in a row, garnering $8.3 billion in new assets; 
• Investors redeemed $3.6 billion from high-yield bond funds in November, a category that has seen inflows of $24.4 billion so far this year, while continuing to add to bank-loan funds. These offerings took in new assets of $1.8 billion in November to bring the year-to-date total to $9.2 billion; and 
• Inflows to emerging-markets bond funds slowed to $882 million in November. However, the category—which began the year with assets of just $46.3 billion—has taken in $20.0 billion year-to-date. Diversified emerging-markets were the lone bright spot within the international-stock asset class, collecting inflows of more than $1.1 billion in November.

The complete report is available here.

Sara Kelly