Investors Exit Active Funds to Tune of $159B Over Past Year: Morningstar

Different fund groups are being impacted by these trends, of course.

Vanguard, for instance, saw its passive fund flows top $16 billion in July, while its active funds had outflows of $1.3 billion. For the past year, its inflows have been over $259 billion. “J.P. Morgan and, surprisingly American Funds, were the only two providers with strong flows on the active side in July. J.P. Morgan’s captive-advisor-audience strategy keeps attracting flows,” Lamy explained.

In July, J.P. Morgan had active-fund inflows of $1.4 billion, while American Funds saw $1 billion flow into its active products. For the past 12 months, J.P. Morgan active funds drew close to $21 billion, as American Funds’ active product attracted nearly $11 billion.

PIMCO, Fidelity Problems

The PIMCO Total Return Fund “was once again the leader in terms of outflows among active funds,” according to Morningstar. Its July outflows were $3 billion, and its 12-month outflows stand at about $126.4 billion. On the bright side for the fund company, the PIMCO Income Fund had inflows of $1.2 billion in July and $10.6 billion since July 2014.

Still, outflows from both active and passive products came close to $4.6 billion in July, and its 12-month outflows approached $180 billion.

Bill Gross, who used to run the PIMCO Total Return Fund but is now managing the Janus Unconstrained Bond Fund, is encountering headwinds with his new product. “The fund has only been able to attract $1.5 billion since its inception in May 2014,” and through July “it has now experienced outflows for three consecutive months,” stated Morningstar’s latest fund report.

Over at Fidelity, the fund giant has been transferring assets to collective investment trusts. When such movement is excluded from its outflows by Morningstar analysts, outflows for its Contrafund, for instance, stood at about $530 million in July and $5.2 billion for the past year.