Investors Embrace Inflation Protected Bond Funds And ETFs In July

Aug. 18, 2021 7:35 AM ETVOO, IJR, IEFA, SCZ, XLV, IYR, QYLD, SVXY, BSV, GOVT1 Comment3 Likes
Tom Roseen profile picture
Tom Roseen
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Summary

  • For the second month running, mutual fund investors were net sellers of fund assets, redeeming $15.0 billion from conventional funds for July.
  • Fixed income funds (+$20.5 billion for July) witnessed net inflows for the fifteenth month in a row, while money market funds (-$23.8 billion) experienced net outflows.
  • For the fourth straight month, investors were net sellers of stock & mixed-assets funds (-$11.8 billion).
  • APs were net purchasers of ETFs, injecting $54.1billion for July, for their twenty-third month of consecutive inflows.
  • And, for the sixteenth month in a row, fixed income ETFs (+$17.8 billion for July) attracted net new money, while investors padded the coffers of stock & mixed-asset ETFs (+$36.3 billion), their fourteenth straight month of net inflows.

A background of scattered one-hundred-dollar bills over the entire space, close-up in the middle of a stack and a roll of dollars in the shape of a ship.
Andrei Barmashov/iStock via Getty Images

Investors were net redeemers of mutual fund assets for the second month in row, withdrawing $15.0 billion from the conventional funds business (excluding ETFs, which are reviewed in the section below) for July. For the fourth month in a row, stock & mixed-assets funds experienced net outflows (-$11.8 billion). The Treasury yield curve continued to flatten during the month, pushing the fixed income funds macro-group to its fifteenth consecutive month of net inflows, attracting $20.5 billion for July. Money market funds (-$23.8 billion) witnessed net outflows for the second consecutive month. Over the last seven months, stock & mixed-assets funds handed back $167.5 billion, while bond and money market funds attracted $344.6 billion and $173.7 billion, respectively, of net new money.

For the twenty-third straight month, ETFs witnessed net inflows, taking in $54.1 billion for July. Authorized participants (APs—those investors who actually create and redeem ETF shares) were net purchasers of stock & mixed-assets ETFs for the fourteenth consecutive month, injecting $36.3 billion into equity ETF coffers. And for the sixteenth month in a row, they were net purchasers of bond ETFs—injecting $17.8 billion for the month. APs were net purchasers of all five equity-based ETF macro-classifications, padding the coffers of U.S. Diversified Equity ETFs (+$21.1 billion), World Equity ETFs (+$13.3 billion), Alternatives ETFs (+$807 million), Mixed-Assets ETFs (+$757 million), and Sector Equity ETFs (+$323 million). Over the last seven months, stock & mixed-assets ETFs took in $385.1 billion and bond ETFs attracted $125.6 billion of net new money.

In this report, I highlight the July 2021 fund-flows results and trends for both ETFs and conventional mutual funds.

FUNDFLOWSINSIGHT REPORT
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This article was written by

Tom Roseen profile picture
1.45K Followers
Tom Roseen is the Head of Research Services, joining from Janus in 1996. He is the editor and an author of Lipper's U.S. Research Studies, FundFlows Insight Reports and FundIndustry Insight Reports. He is involved in fund analysis and research, and contributes to the monthly and quarterly equity and fixed income FundMarket Insight reports, webcasts and podcasts, where he focuses on domestic and world fund performance and attribution. His areas of expertise include closed-end fund analysis, portfolio evaluation, equity and fixed income fund research, fund flows analysis, after-tax performance and Lipper Leaders. Tom has a BS in finance from Metropolitan State College of Denver and a Master's in International Management from the University of Denver.
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Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

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