Investing February 27, 2004

Equity Outpouring Helps January Win Fund Flow Race Going Away

February 27, 2004 (PLANSPONSOR.com) - Stock and bond mutual funds went from a brisk canter to a full gallop in January as $46 billion in new assets poured in - far outpacing the $37 billion gain in December.

Reported by

Fred Schneyer

Once again, it was domestic equities that led net inflows among fund types, netting $31.8 billion in January – again beating December’s $16.8 billion asset advance by a few lengths (See Funds Pull in $24.3B In December Asset Advance ),while International/Global came in a distant second place in January, taking in $13.4 billion – compared to December’s $9.44 billion inflow. Otherwise, the only other positive inflow was noted in the $3.14 billion recorded among Corporate bonds while the other fund categories – Government and Tax-Free – recorded net outflows for the month of $2.04 billion and $249 million, respectively, according to a Financial Research Corporation (FRC) report.

Per Morningstar fund category, it was Large-Cap Value that took the top prize, accumulating $6.51 billion in the month. This was followed by Moderate Allocation, gaining $5.40 billion in terms of net flows. The rest of the top five was composed of:

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Foreign Large-Cap Blend – $3.59 billion
Small-Cap Blend – $2.9 billion
Large-Cap Blend – $2.77 billion

Fund Families

Vanguard Group and Fidelity Investments held the top fund group spots in January, with $637 billion and $631 billion, respectively. Behind the two sizeable fund families in the total asset race were:

American Funds – $504 billion
Franklin Distributors Inc. – $192 billion
PIMCO Funds – $147 billion.

Among January best sellers was American Funds at the top, netting a $11.6 billion inflow. This was followed up by Vanguard’s $10.9 billion, Fidelity’s $4.72 billion, Dodge & Cox’s $2.83 billion, and T. Rowe Price’s $2.63 billion.

Top Sellers

In the top slots for January’s hot fund sellers were: