Morningstar says taxable-bond funds collected about $28.5 billion in asset inflows in February, the largest monthly uptick since January 2013. The greatest inflows went to high-yield bond funds, which may do well in a rising interest-rate environment; utilities funds had the largest February outflows.
Total flows into long-term active funds were $14.3 billion in February, while they were close to $50 billion for passive funds. During the period, money-market funds had outflows of $10.5 billion.
As for fund families, Vanguard continued to dominate inflows among passive providers, according to the fund research group. It had passive flows of $19.6 billion in February and $225.3 billion for the past 12 months.
Vanguard also took the lead among active providers in February with $2.7 billion in flows. J.P. Morgan remained the top provider as measured by one-year inflows among active-fund providers at $96.6 billion.
PIMCO’s total redemptions came to nearly $175 billion since January 2014, representing a 33% drop in assets. In the six months since PIMCO co-founder Bill Gross’ departed for Janus Capital, the popular PIMCO Total Return has shed close to $100 billion as of Feb. 28.
These outflows boosted inflows to other intermediate-term bond funds, including the Metropolitan West Total Return Bond and Dodge & Cox Income.
On March 9, 2009, the stock market hit 12-year lows. The Dow Jones traded under 6,550, while the S&P 500 was trading near 676 and the Nasdaq at 1,268.
Six years later, the Dow has been trading at around 18,000, the S&P 500 near 2,100, and the Nasdaq at almost 5,000. All three indexes recouped their losses from the crisis and returned to their earlier growth trends.
Of course, this is great news for both advisors and investors, says a Morningstar expert, as the bull run since ‘09 has lifted mutual funds across the board.