Assets flowing into open-end target maturity funds totaled $16.6 billon in the first quarter, a 7% increase over the first quarter of 2010, according to the Ibbotson Target Maturity Report Q1 2011, released Monday. The $17.3 billion in flows recorded during the fourth quarter of 2007 is the only quarter that exceeded the first quarter 2011 result, Ibbotson notes.
Among top-tier mutual fund providers, Ibbotson found that Vanguard had the strongest quarter growing at a 7.2% organic growth rate, while T. Rowe Price also turned in a solid quarter growing at 5%, which was higher than any of the three previous quarters. “Aspiring providers,” Ibbotson said, continued to achieve positive flows, including J.P. Morgan and USAA, with $402 million and $203 million in flows for the quarter, respectively. On the flipside, AllianceBernstein "continued its run of outflows" as it saw $48 million move out during the quarter, Ibbotson found.
As far as specific drivers of performance in the first quarter, “the big winners were small cap growth and REITs”—with small cap growth returning over 9% while REITs returned about 7.5%, Jeremy Stempien, a senior consultant at Ibbotson, and co-author of the report, told AdvisorOne on Monday. Also unique to first quarter performance of target maturity funds was the commodity asset class, he notes. “Target maturity funds that invested in energy-heavy commodities potentially saw a significant boost in their returns.”