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Money Leaves Mutual Funds in May

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June 24, 2004 — Fears of higher interest rates weighed on investors, leading them to withdraw money from domestic stock and bond mutual funds last month. But assets increased for funds that invest in foreign stocks.

Domestic stock funds suffered outflows of $449 million in May, while bond funds lost $13.2 billion in assets, and funds that buy foreign stocks attracted $2.4 billion, Financial Research Corp. said. The figures include exchange-traded funds.

American Funds continued as the top selling fund complex, raking in $5.4 billion. The company’s Growth Fund of America/A (AGTHX) led all individual funds with inflows of an estimated $1.2 billion.

Fidelity Investments, the nation’s largest mutual fund company, saw its assets decrease by nearly $2.1 billion. Vanguard Group, the No. 2 U.S. fund company, took in $581 million. Barclays Global Investors, a major player in the ETF field, netted $2.1 billion.

Putnam Investments and Janus Capital Group (JNS), which have lost investors in recent months because of the mutual fund trading scandal, leaked assets again in May. Putnam saw outflows of $3.3 billion, and Janus lost $1.5 billion.

Among the top selling funds, Growth Fund of America was trailed by two other American Funds offerings, American Balanced Fund/A (ABALX), which took in $954 million, and Capital Income Builder Fund/A (CAIBX), which netted $618 million.

Two other American funds, Income Fund of America/A (AMECX) and Capital World Growth and Income Fund/A (CWGIX), both attracted an estimated $584 million to take fifth and sixth place.

The No. 4 spot was held by Rydex Srs Tr:Juno Fund/Inv (RYJUX), which took in $609 million. The portfolio is designed to go up when Treasury bonds go down.

Contact Robert F. Keane with questions or comments at:

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