$25 billion returns to stock funds
April inflows erase previous outflows, researcher says
By Craig Tolliver, CBS.MarketWatch.com
Last Update: 2:13 PM ET May 16, 2001
NEW YORK (CBS.MW) -- Stock funds pulled in a whopping $25 billion last month, erasing two months of outflows by investors who sought refuge from the bear market, a research firm reported Wednesday.
"It was reassuring to see that both U.S. and foreign equity funds showed inflows lately, spanning a wide range of investment styles. In the U.S., gains were noticeable in value and growth stocks, in small cap and large cap, and even in tech-dedicated funds," said Avi Nachmany, director of research at Strategic Insight.
From February through March, investors yanked some $24 billion from stock mutual funds, according to the Investment Company Institute. The industry trade group is due to report its April numbers at the end of this month.
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Nachmany said that the average net asset value among equity mutual funds jumped 8 percent during in April, providing a strong lure to returning investors.
By comparison, Trim Tabs, a research group in Santa Rosa, Calif., issued preliminary estimates showing a much more conservative inflow of roughly $12 billion, half the Strategic Insight estimate. However, Trim Tabs shared the view that the stronger market provided much needed incentive.
"Inflows recovered pretty quickly because of the good markets," said Carl Wittnebert, Trim Tabs' director of research. "It's surprising that people have not lost faith in the stock market, but I think that number shows that while they're still a little cautious, they do believe in the market."
Domestic U.S. growth funds captured nearly $7 billion in April, with new cash flowing across all market caps, according to New York-based Strategic Insight. Value funds pulled in $6 billion in net new flows, also across all segments, with the fastest growth among small and mid-cap funds.
Among International equity funds during April, a number of diversified programs increased their inflows, with smaller gains in European and Pacific funds.
Through mid-May, Strategic Insight estimates that stock funds have attracted $40 billion since the beginning of the year.
Craig |
