Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Making Money is Main Objective -- Ignore unavailable to you. Want to Upgrade?

To: lightwave51 who wrote (1734)	1/7/2002 2:08:28 PM
From: Psycho-Social	Read Replies (1) \| Respond to of 2155

Outflows from Stock Funds: Right data, wrong conclusion. I've been following fund flows for over 13 years and found them to be a very reliable contrarian indicator, with a lead time range of 0 to 3wks. I follow AMG Data #s, but they show a similar picture. Fund flows peaked at +$5 billion/wk at the start of November, and have declined steadily since then, to a -$5 billion for the most recent week. After its rise to a November 8th peak near 1135, the S&P has, essentially, gone sideways since then. The data is muddied by seasonal patterns of weakness and outflows from international funds, but the latest week should have taken us beyond the pre-distribution weakness. Far from being a bearish indication, this pattern of sharply declining $ flows as the Market goes sideways is actually bullish. It may seem strange to say it, but in all my years of following flows into stock funds, no major Market uptrend has ever ended when fund flows were negative. This is especially true in January, when seasonal flows tend to be strong. Conclusion: This uptrend cannot end until flows into stock funds turn strongly positive, and for more than just one week.