Oct. 31, 2003 — Stock funds received net cash inflow of $17.32 billion in September, below the $23.40 billion taken in August, according to data from the Investment Company Institute.
Domestic equity funds had an inflow of $16.95 billion in September, compared with an inflow of $18.59 billion in August. Stock funds that invest overseas had an inflow of $371 million in September, compared with an inflow of $4.81 billion in August.
“Mutual fund flows in September were in line with past shareholder behavior,” said ICI Chief Economist John Rea. “The positive net cash flows into stock funds continue to reflect the rise in stock prices that began earlier this year. In September, stock prices reversed that trend, declining a little over 1%. That decline offset new investments into stock funds, leading to the small decline in assets.”
Bond funds continued to lose cash, but at milder rates. As a whole, taxable and municipal bond portfolios had an outflow of $5.84 billion in September, compared with an outflow of $12.58 billion in August. “New investments into bond funds also have followed a historical pattern,” Rea said. “Bond funds have experienced outflows for three months since long-term interest rates backed up this summer.”
Hybrid funds, which invest in stocks and bonds, had an inflow of $3.76 billion in September, compared with an inflow of $3.34 billion in August.
Money market funds had an outflow of $49.66 billion in September, compared with an outflow of $20.28 billion in August. Funds offered primarily to institutions had an outflow of $23.58 billion in September. Funds offered primarily to individuals had an outflow of $26.08 billion for the month. “These flows reflect low short-term interest rates and typical seasonal outflow associated with quarterly tax payments.” Rea said.
Year to date through September, equity funds have received an inflow of $97.55 billion, compared with an outflow of $18.62 billion at this time last year.
Overall, the combined assets of the nation’s mutual funds decreased by $22.10 billion, or 0.3%, to $6.95 trillion in September.