Flow from equity and bond funds continue: TrimTabs

NEW YORK Sun Sep 1, 2013 2:12pm EDT

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NEW YORK (Reuters) - The recent decline in U.S. equities pushed investors to redeem $16.7 billion in U.S. equity mutual funds and exchange-traded funds (ETFs) in August through Wednesday, data from research provider TrimTabs showed on Sunday.

The outflow reversed almost half of July's $39.3 billion inflow, the firm noted, an amount that was a record.

"We think the shift was due mostly to institutions unwinding badly timed bullish bets on U.S. equities," TrimTabs wrote to clients.

The S&P 500 fell 3.1 percent in August, the benchmark index's worst monthly performance since May 2012, though it remains up about 14.5 percent in 2013.

The monthly decline came amid geopolitical uncertainty over a possible Western military strike on Syria, as well as concerns that the U.S. Federal Reserve would soon begin to slow its bond-buying stimulus program.

Bond mutual funds and ETFs redeemed $39.5 billion in August through Wednesday, the third-highest outflow on record. Since the start of June, investors have pulled $123.4 billion from the funds on concerns over an easing to the Fed's accommodative monetary policy.

"Now that these 'safe' investments have delivered losses for four consecutive months and the Federal Reserve is jawboning about slowing the flow of newly created money, investors are scrambling for the exits," TrimTabs wrote.

(Reporting by Ryan Vlastelica; Editing by Sandra Maler)

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Comments (1)
vince7777 wrote:
“Investors are normally late to the party chasing hot markets and have a stop/start mentally. Time and time we see investors that do not match the index returns – for most the simple solution is just buying index funds (Tracker ETFs) and learn some basic trading techniques.”

Vince Stanzione http://www.fintrader.net

Sep 01, 2013 2:52pm EDT  --  Report as abuse
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