May 29, 2002 — Mutual funds that buy small company stocks continued to attract investments last month, even as the amount of money flowing into funds slowed.

Small-cap funds took in $22.6 billion last month, surpassing inflows into large-cap funds, which netted $16.8 billion, and mid-cap funds, which took in $16.3 billion, according to Financial Research Corp.

Overall, stock and bond funds drew $22 billion last month, down from $33.95 billion in March, but modestly more than their April 2001 intake of $20.85 billion.

Small-cap funds that invest in undervalued stocks, growth stocks, or a combination of both were among the best-selling offerings last month, providing “evidence” that investors are craving the prospects of investing in small companies, the Boston-based financial services consulting company said.

American Funds and the Vanguard Group ranked No. 1 and No. 2 in inflows in April, netting $6 billion and $4.5 billion respectively. The companies have held the top two spots since October. Through last month, they had drawn a total of $40 billion in inflows, or $39.4% of the industry’s net sales this year, FRC said.

Dodge & Cox Funds garnered $1 billion last month, the most the firm ever taken in in one month, to rank fifth among best-selling fund complexes. Led by Dodge & Cox Stock Fund (DODGX), which had netted $2.5 billion through April, the company generated $3.6 billion in net sales through the end of the month, FRC said.

American Funds’ Growth Fund of America/A (AGTHX) was the top selling fund in April, raking in $1.25 billion. It was followed by PIMCO Funds:Total Return Fund/A (PTTAX), which took in $1.12 billion, and Fidelity Low Priced Stock (FLPSX), which garnered $1.04 billion.