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Cash Flow Into Equity Funds Eases in April: ICI

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May, 30, 2002 — Stock funds witnessed a net inflow of $11.76-billion in April, down significantly from the $29.63-billion intake in March, according to data released by the Investment Company Institute (ICI).

Of the total, domestic equity funds were enriched by $11.08-billion in net cash in April, compared with an inflow of $26.66-billion in March. Stock funds that invest overseas had an inflow of $678-million in April, versus an inflow of $2.97-billion in March.

Cash going into bond funds (taxable and tax-exempt) accelerated in April. Fixed-income portfolios had a net inflow of $7.81-billion, compared with an inflow of $6.71-billion in March.

Hybrid funds had in inflow of $3.16-billion in April, compared with an inflow of $3.33 billion in March.

Money market funds had an outflow of $19.56-billion in April, compared with an outflow of $53.09-billion in March. Funds offered primarily to institutions had an inflow of $7.98-billion, while funds that are offered primarily to individuals had an outflow of $27.54-billion.

The combined assets of the nation’s mutual funds decreased by $127.60-billion to $6.935-trillion in April.

“The cash that went in during April was certainly not a roaringly high volume of money, but I think it indicates that investors are still keeping the faith and not cashing out despite the many uncertainties weighing down the market,” said Louis Harvey, president, Dalbar Inc., a Boston-based mutual fund consultant. Harvey noted that the net cash flow picture is far healthier than it was at this time last year.

Indeed, year-to-date through the end of April, stock funds are far ahead of last year’s pace, having received net new cash flow of about $66.84-billion, versus an inflow of about $20.06-billion for the comparable period in 2001.