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Portfolio > Mutual Funds

FRC: Variable Product Buyers See The World

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U.S. residents may be shunning domestic stocks.

Financial Research Corp., Boston, has published data supporting that view in a report on February variable product net flows.

Variable product stock, bond and money-market options took in $1.2 billion more cash than they lost in February, down from a net inflow of $2.4 billion in February 2005, according to FRC.

FRC adds a very important warning: The flow totals exclude the hot new lifestyle funds and other “funds of funds.”

But the FRC flow figures suggest that U.S. investors are developing a specific aversion to U.S. equities.

Net flow of cash into all stock and bond options fell to $901 million, from $3.5 billion.

But the net flow of cash out of U.S. stock investments was $1.3 billion. Domestic stock variable portfolios gained $1.3 billion in assets in February 2005.

The net flow of cash into domestic corporate and government bond portfolios fell to $662 million, from $870 million, but the net flow of cash into international and global investment portfolios increased to $1.5 billion, from $1.3 billion, according to FRC.


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