YANG - Conventional Funds Hand Back $34.2 Billion In July While ETFs Attract $38.7 Billion

• For the seventh straight month, mutual fund investors were net redeemers of fund assets, withdrawing $34.2 billion from conventional funds for July.
• Fixed income funds (-$37.6 billion for July) witnessed net outflows for the eighth month in a row, while money market funds (+$23.5 billion) attract net new money.
• For the sixteenth straight month, investors were net sellers of stock & mixed-assets funds (-$20.1 billion).
• APs were net purchasers of ETFs, injecting $38.7billion for July.
• And, for the sixth straight month, fixed income ETFs (+$28.2 billion for July) witnessed net inflows while investors were net purchasers of stock & mixed-assets ETFs (+$10.5 billion).

Investors were net redeemers of mutual fund assets for the seventh month in a row, redeeming $34.2 billion from the conventional funds business (excluding ETFs, which are reviewed in the section below) for July. For the sixteenth month running, stock & mixed-assets funds experienced net outflows (-$20.1 billion). After the Federal Reserve Board hiked its key lending rate on July 27 by an expected 75 basis points (bps), the fixed income funds macro-group—for the eighth consecutive month—witnessed net outflows, handing back $37.6 billion. Money market funds (+$23.5 billion) witnessed net inflows for the second month in a row.

For the third consecutive month, ETFs witnessed net inflows, taking in $38.7 billion for July. Authorized participants (APs—those investors who create and redeem ETF shares) were net purchasers of stock & mixed-assets ETFs—also for the third month in a row—injecting $10.5 billion into equity ETF coffers. For the sixth month in a row, they were net purchasers of bond ETFs—injecting $28.2 billion for the month. APs were net purchasers of three of the five equity-based ETF macro-classifications, padding the coffers of U.S. Diversified Equity ETFs (+$15.3 billion), World Equity ETFs (+$4.9 billion), and Alternatives ETFs (+$3.6 billion), while being net sellers of Sector Equity ETFs (-$13.1 billion) and Mixed-Assets ETFs (-$208 million).

In this report, I highlight the July 2022 fund-flows results and trends for both ETFs and conventional mutual funds (including variable annuity underlying funds).

For further details see: