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The Markets January 25, 2011
Investors Preferred Equities in November
Investors worldwide contributed $40 billion of new cash flows to
long-term mutual funds in November, two-thirds of which went to equity
funds.
Reported by Rebecca Moore
The popularity of equity funds reflects continued improvement in stock market sentiment, said Strategic Insight, an Asset International company. Bond funds added $6 billion globally, indicating at least a temporary pause of persistently strong inflows to fixed income products since early 2009.
On a regional level, the U.S. led the way with $18 billion in net flows, followed by cross-border international funds ($16 billion) and local Asia funds ($8 billion), while local Europe funds experienced $6 billion in net redemptions for the month.
U.S. equity funds saw a $16 billion net inflow in November, while U.S. bond funds posted no net change. Eleven billion dollars flowed into international/offshore equity funds during the month.
SI’s Global Mutual Fund Flow Watch report shows that for Asia funds, the equity sentiment was not that strong; Asia equity funds posted a net outflow of $1 billion in November, while Asia bond funds saw a $7 billion net inflow.
Year-to-date through November investors worldwide pumped $845 billion into long-term mutual funds, led by U.S. funds which posted a net $401 billion inflow. International/offshore funds took in $275 billion, while local Europe funds took in $81 billion. Asia funds posted a net inflow of $65 billion.
Equity funds took in $133 billion year-to-date through November, while bond funds posted a net $566 billion in new cash.