Investors pulled nearly $2 billion from long-term funds in May.
Despite the shift, it hasn’t been a great decade for U.S. equity funds in terms of overall flows.
Cash piled into bond funds in March, and the market share of passive strategies among U.S equity funds reached 49%.
With the Fed signaling a slowdown in rate increases, bond investors have decided it's safe to go back into the water.
In January, the relative flows of passive funds fared worse than their active counterparts for the first time since January 2014.
U.S. funds experienced their greatest monthly outflows in December in a decade.
Monthly fund outflows stabilized in November, as bond investors favored ultrashort vehicles.
The popularity of core index funds suggests that may be the case.
Monthly fund outflows were the highest they've been in more than three years.