* Broader funds see $1.1 bln Feb inflow, new upside in March
* SPDR gold sees $3.8 bln outflow in Feb, more lost in March
* PIMCO, Fidelity commods funds have most inflows
By Barani Krishnan
March 19 Commodity exchange-traded fund
investors have put money into funds with wider commodities
exposure after pulling record amounts from bullion-specific
funds as the price of gold tumbled, data from funds tracker
U.S.-based ETFs tagged as "General Commodities Funds"
attracted more than $1 billion in February, their highest in
nearly a year after outflows from September though December, the
data showed. They had inflows of a little more than $1 billion
in January and were headed for another positive month in March.
In contrast, funds dedicated to precious metals saw an exit
of nearly $4 billion in February after outflows of $765 million
the previous month. The February outflow was the most recorded
by Lipper since the Thomson Reuters company began tracking
investment activity among commodity ETFs in Nov. 2004.
Almost all of that outflow was from the SPDR Gold Trust
, the world's largest gold-backed exchange-traded fund.
Lipper data through the first two weeks of March indicated a
further loss of more than $1 billion from precious metals ETFs.
"If you find gold isn't your place to be now and don't want
to move all your money to equities and other high-yielding
products, then the more-diversified and actively-managed General
Commodities Funds might be for you," said Lipper analyst Matt
Lemieux, who compiled the data.
But Lemieux noted that broader commodity funds also had a
history of volatile flows. He said investor interest in them
will depend on how energy, metals and crop prices fare. "We're
going to have to see better precedent for the broader commodity
markets because they've been struggling for some time now."
PIMCO LEADS INFLOWS, SPDR GOLD OUTFLOWS
For a second month in a row, giant bonds investor PIMCO and
mutual funds firm Fidelity led inflows in a monthly table of
some 220 U.S.-based commodity ETFs, mutual funds and products
issued by Lipper.
PIMCO's Commodities PLUS Strategy Fund drew nearly
$264 million in February, the most of the lot. The Fidelity
Series Commodity Strategy Fund came in second, taking
in almost $210 million.
The two belong to Lipper's Commodities General Funds group,
which took in $1.1 billion last month. That was the highest
amount the group had attracted since the $1.9 billion it took in
The group is dominating inflows again this month, gaining
$223 million between March 1 and 13.
In Lipper's Precious Metals Funds group, SPDR Gold had the
largest outflow for February with $3.8 billion. BlackRock's
iShares ETF for silver offset some of the losses
by taking in nearly $260 million.
Precious metals funds have extended their losses this month,
with an exodus of nearly $1.3 billion from March 1-13.
Last year, some 70 percent of investments that flowed into
U.S. commodity ETFs went into SPDR and another gold fund run by
iShares. SPDR, also known as Spyder Gold, had a net inflow of
$5.3 billion and the iShares Gold ETF $2.4 billion.
The build-up in the two ETFs was based on expectations,
later confirmed, that the U.S. Federal Reserve would launch a
third round of quantitative easing to boost the economy.
Interest in gold investment products also swelled as bullion
prices rallied for a 12th straight year.
FAR FROM EVEN
The trend changed after signs of stronger economic recovery
in the United States, Europe and China made investors more open
to risk since this year began. Some of the money investors had
put into gold as a hedge against troubled times began flowing
toward oil, base metals and crops. U.S. stocks also benefited,
as the Dow Jones industrial average hit record highs.
But gains in broader commodities have been far from even.
The 19-commodity Thomson Reuters-Jefferies CRB index
rose 3 percent in January, lost nearly 4 percent in February and
is flat so far this month.
The spot price of gold slipped 0.7 percent in January
and tumbled another 5 percent in February, but has gained 2
percent this month. Spot gold traded at just above $1,610 an
ounce on Tuesday as some investors sought a safe haven after a
troubled bank bailout attempt for Cyprus raised worries over
euro zone stability.
Still, gold remains well below the January peak of nearly
"If I'm into ETFs, I'll still hold away from gold," said
Adam Sarhan at New York's Sarhan Capital. "Everytime gold has
tried to rally since December, it has failed. The Cyprus drama
is still a small piece in the game for now."