Thursday September 27 3:52 PM ET
Investors Pull $5.25 Billion From Funds
NEW YORK (Reuters) - Investors drained money from stock mutual funds in August for the second straight month and may have withdrawn even more in September, as the stock market continued its descent.
Investors took out a net $5.25 billion from U.S. stock funds in August, the industry's trade group, the Investment Company Institute, reported on Thursday. That follows an outflow of $1.23 billion in July, according to the group.
September outflows could be even bigger than August withdrawals, according to some estimates, as investors grow even less confident after the Sept. 11 attacks on the United States. It would mark the first time the industry witnessed three consecutive months of outflows since the late 1990s -- when the United States began preparing for the Gulf War (news - web sites).
Before August, the fund industry this year already had recorded stock outflows in February, March and July. Throughout the 1990s and in 2000, investors added new money to stock portfolios in almost every month, with only a few exceptions.
Amid sharp market losses -- the Standard & Poor's 500 Index (^SPX - news) has dropped 23.7 percent so far this year -- many investors have lost their appetite for stocks, moving money to safe havens like bond and money market funds. |
