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June 30, 2017 at 08:30 AM
Flows into fixed income funds remain steady in 2017 despite attempts from central banks to tighten monetary policy, making 2017 a prosperous year for fixed income managers, according to Boston-based research firm Cerulli & Associates.
The June 2017 issue of The Cerulli Edge – U.S. Monthly Product Trends Edition reports that, bolstered by positive net flows moving into active mutual funds ($7.7 billion), total mutual fund flows ($35.6 billion) outpaced ETFs ($33.0 billion) for the first time since February 2016.
Flows and strong global capital markets contributed to asset growth of 1.4% during the month, ending May at $13.5 trillion. ETF asset growth eclipsed 2% for the second straight month as assets increased to more than $2.9 trillion.
The research found that 50% of advisors plan to increase their use of fixed income ETFs over the next three years, while roughly 40% of advisors plan to decrease their use of fixed income mutual funds over that period, prompting some fund managers to consider developing active fixed income in the ETF wrapper.
