US bond funds hit $1 trillion

Wall streetInflows into US fixed income mutual funds total more than $1 trillion (€750 billion) since the beginning of 2008.

Morningstar, which released the data in Europe last night, says that in 2012 money continued to flow out of actively managed stock funds and into all manner of bond funds, with yields across many fixed-income sectors either at or near all-time lows.

Since the end of 2008, assets in taxable-bond funds have more than doubled, climbing from $1.1 trillion to $2.5 trillion, with approximately 65% of the increase attributable to net inflows.

The overall figure of $1 trillion includes municipal bond funds.

2012 outflows from actively managed US stock mutual funds surpassed those seen in 2008 despite the fact that the S&P 500 was up 16% for the year.

Morningstar says that even when exchange-traded funds are included, large-cap US stock funds have seen net outflows over the trailing five-year period and in each of the last four years.

Vanguard and Pimco, which both have large index businesses, captured 61% of net inflows in 2012, compared with 30% in 2011 and 46% in 2009.

Overall, long-term open-end funds saw inflows of $243.2 billion in 2012.

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