The Markets December 15, 2010

Mutual Fund Flows Slow in November

After contributing $26.8 billion to long-term mutual funds in October, investors added just $2.7 billion in November, according to data from Morningstar.
Reported by

Investors lost enthusiasm for fixed-income funds as well. Money market funds were the direct beneficiaries with inflows of $24.7 billion, their best month since January 2009, a press release said.  

Inflows for taxable-bond funds reached just $6.1 billion in November versus $21 billion in October, the smallest monthly inflow for the asset class since May. After 22 consecutive months of net inflows, municipal-bond funds saw net outflows of $7.6 billion in November. This reversal comes after investors added nearly $105.6 billion to the asset class from January 2009 through October 2010 and marks the worst month for municipal-bond funds in terms of net outflows except for the $8 billion redeemed in October 2008 during the credit crisis.   

For more stories like this, sign up for the PLANADVISERdash daily newsletter.

Rising rates and currency swings contributed to a tough month for emerging-markets bond and world-bond funds, some of the more aggressive areas of the bond market. Nevertheless, money continued to flow to emerging-markets bond funds. These offerings have collected more than $13.7 billion in 2010, and total assets have nearly doubled over the last 12 months to $36.8 billion, according to the press release.   

Large-growth funds had the biggest outflows of any Morningstar category this year, losing $43.5 billion.  

Investors pulled $1 billion from Vanguard funds in November, the firm’s first month of long-term fund outflows since October 2008. Equity-oriented families including American, Fidelity, and Columbia also continued to suffer outflows. Despite redemptions of $1.9 billion from PIMCO Total Return, the fund’s first month of net outflows in two years, PIMCO still took in $1.1 billion during November.  

Data & Research December 14, 2010

Investors Say Advisers Help Them Save More

People who spend time with a financial professional report saving two to three times more than their peers who do not, according to a study from the ING Retirement Research Institute.
Reported by

The research found that investors who work with an adviser feel more knowledgeable about investments and more confident in their ability to enjoy retirement, and they sasaving more.

ING Retirement Research Institute analyzed data from more than 14,000 users who used INGCompareMe.com – a Web site in which users can enter their personal information to see where they stand in relation to others on saving, spending, investing, debt, and personal finance matters. One question asks how much time they spend with a financial adviser; possible response choices ranged from no time to a lot of time.   

Never miss a story — sign up for PLANADVISER newsletters to keep up on the latest retirement plan adviser news.

According to the data, those who spent “some time” with an adviser (31%) reported saving, on average, more than twice as much for retirement as those who spent “no time.”  The number jumped even higher–more than three times as much–for those who spent “a lot of time” getting such help.

Spending time with a financial professional impacted how an individual invested with respect to their asset allocation. According to the data, a majority (60%) of those who spent some time or a lot of time with an adviser considered themselves to be moderate investors. The number who characterized themselves as moderate dropped to less than half (48%) when they spent very little or no time, and thus tended to be more conservative.

Confidence about future financial success also varied greatly between those who spent “a lot of time” versus “no time” with a financial professional.  More than six-in-ten (62%) of those who spent a lot of time with one said they were highly confident about enjoying their retirement.  For those who spent no time, only about one-third (34%) reported the same level of confidence.

«