Bond Investors Go Short
Monthly fund outflows stabilized in November, as bond investors favored ultrashort vehicles.
Monthly fund outflows stabilized in November, as bond investors favored ultrashort vehicles.
Note: This is an excerpt from the Morningstar Direct U.S. Asset Flows Commentary for November 2018. The full report can be downloaded here. |
Long-term flows stabilized a bit in November with about $1.5 billion in outflows after last month's $29 billion in outflows. But overall, 2018 long-term flows will likely finish well below the average from the prior 10 years. From 2008-17, annual long-term flows averaged about $351 billion. Through November 2018, year-to-date long-term inflows were about $245 billion. So far, January was the only month in which long-term 2018 flows exceeded $100 billion.
Bond and equity investors went in opposite directions in November. Equity investors were sanguine about risk, but not bond investors. Bond investors continued flocking to ultra-short-term vehicles. Money market funds collected $78.7 billion, the most since December 2014, and ultrashort bond funds recorded another record month of inflows with $13.2 billion.
While there was plenty of volatility in the equity markets, the S&P 500 finished up 2% for the month, and the MSCI ACWI ex USA Index rose about 1%. Whether these slight gains influenced investor behavior or not, equity flows were positive. U.S. equity funds collected about $11.6 billion, with international-equity funds pulling in about $8.5 billion.
Download the complete Asset Flows Commentary here. |
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