Investors Prefer Equity ETFs Over Equity Funds In September

Oct. 20, 2021 6:21 AM ETSPY, IVV, VXUS, ACWI, IYR, XLF, QYLD, SPXU, LQD, BSV2 Likes
Tom Roseen profile picture
Tom Roseen
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Summary

  • For the second consecutive month, mutual fund investors injected $6.9 billion into conventional funds for September.
  • Fixed income funds (+$35.5 billion) witnessed net inflows for the seventeenth month in a row, while money market funds (+$2.6 billion) experienced net inflows for the second.
  • For the sixth straight month, investors were net sellers of stock & mixed-assets funds (-$31.2 billion).
  • Authorized Participants (APs) were net purchasers of ETFs, injecting $52.2 billion for September, for their twenty-fifth month of consecutive inflows.
  • And, for the eighteenth month in a row, fixed income ETFs (+$15.7 billion for September) attracted net new money while investors padded the coffers of stock & mixed-assets ETFs (+$36.5 billion), their sixteenth straight month of net inflows.

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Investors were net purchasers of mutual fund assets for the second month in a row, injecting $6.9 billion into the conventional funds business (excluding ETFs, which are reviewed in the section below) for September. For the sixth month in a row, stock & mixed-assets funds experienced net outflows (-$31.2 billion). And despite the Treasury yield curve steepening for the month, the fixed income funds macro-group took in net new money for the seventeenth consecutive month, taking in $35.5 billion for September. Money market funds (+$2.6 billion) attracted net new money for the second month running. Over the last nine months, conventional stock & mixed-assets funds handed back $216.9 billion, while bond and money market funds attracted $419.1 billion and $200.2 billion, respectively, of net new money.

For the twenty-fifth straight month, ETFs witnessed net inflows, taking in $52.2 billion for September. Authorized participants (APs—those investors who actually create and redeem ETF shares) were net purchasers of stock & mixed-assets ETFs for the sixteenth consecutive month, injecting $36.5 billion into equity ETF coffers. And for the eighteenth month in a row, they were net purchasers of bond ETFs—injecting $15.7 billion for the month. Once again, APs were net purchasers of all five equity-based ETF macro-classifications, padding the coffers of U.S. Diversified Equity ETFs (+$26.0 billion), World Equity ETFs (+$8.0 billion), Mixed-Assets ETFs (+$1.2 billion), Alternatives ETFs (+$1.0 billion), and Sector Equity ETFs (+$270 million). Over the last nine months, stock & mixed-assets ETFs took in $470.5 billion and bond ETFs attracted $160.8 billion of net new money.

In this report, I highlight the September 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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