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May 04, 2020 at 04:43 PM
Mutual funds and exchange-traded funds hemorrhaged assets in March, as investors withdrew some $320 billion from these products, according to the April Cerulli Edge U.S. monthly product trends report.
Some asset classes were exempt from this trend as the coronavirus tornado swept across the country. Passively managed equity strategies added $35.8 billion during March, $20.7 billion coming through mutual funds and $15.1 billion through ETFs.
Investors directed net flows within passive equities mainly to U.S. equities. Cerulli said demand for passive U.S. equity likely arose from investors reallocating into high-quality, low-cost equity index-tracing products that offered more attractive prices that resulted from the severe equity market declines.
The analysis showed that asset managers endured double-digit asset declines during March, with mutual funds falling 13.6% and ETFs declining 12.4%.
Mutual funds took a historically hard hit, as investors withdrew $335.2 billion, or 2.2% of February month-end assets. Outflows for the January-to-March period were only a bit less grim at $291.7 billion.
ETFs got off a bit easier during the March selloff. The overall decline in assets was lessened because investors held steady on a net basis, adding $9.3 billion in positive flows into the vehicle during the month.
