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Weekly Fund Flows - October 20, 2010

Positive inflows continued this past week into all major asset classes with the exception of money markets, which saw an outflow of $17 billion, or -0.70% of assets.  

  • High Grade +$471 million, or 0.10% of assets.  
  • High Yield +$347 million, or0.30% of assets.  
  • Bank Loans +$290 million, or 1.20% of assets.
  • EM Debt continues unabated with inflows of $202 million,or 1.20% of assets.
  • Equities and Commodities saw sparse inflows.

 Bank loans and EM debt taking in that amount of money has caution written all over it.  Bank loans I get (having been beaten about the head and hands in restructuring by the banks), but EM debt is a another beast.  Political instability (not a huge factor right now), rule of law (or lack thereof - always a problem), and the differentiation between local and foreign investors can lead to bad results.  Not negative, but cautious given the risks and where it is priced.

Disclosure: long most asset classes