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Mutual Fund Asset Flows "Healthy" But Losing Pace - Morningstar
Eliane Chavagnon
17 May 2013
Inflows for long-term mutual funds stood at a “healthy” $37.8 billion in April, but continued to moderate from levels seen earlier this year, according to Morningstar data. Inflows for US equity funds slowed to $895 million, their lowest intake this year. But despite “tepid interest” in core, intermediate-term bond funds, taxable bond funds garnered $19.4 billion, marking their 20th consecutive month of inflows. International equity funds posted inflows of $8.4 billion, the second strongest inflows among category groups. However, alternative funds had the strongest organic growth rate among category groups, taking in $3.8 billion. Although taxable-bond funds have led all category groups so far this year, the top asset-gathering categories within the group have shifted. Inflows for intermediate-term bond, high-yield bond and emerging-markets bond funds have slowed from levels seen in 2012, while bank-loan and non-traditional bond funds have “gained ground.” Meanwhile, within the US equity category group, investors “continued to prefer index funds and the value style over growth,” Morningstar said. Inflows to index funds totaled $9.6 billion, while active US equity funds posted outflows of $5.2 billion.