Long-term mutual funds and exchange-traded funds (ETFs) attracted USD9.0 billion of new investor cash during September, according to Morningstar.
Active taxable-bond funds registered their most significant monthly outflow since June 2013, USD18.7 billion, spurred by the 26 September announcement of Bill Gross’ departure from PIMCO.
Outflows from PIMCO Total Return aside, taxable-bond funds have otherwise seen relatively consistent inflows year to date. Morningstar estimates net flow for mutual funds by computing the change in assets not explained by the performance of the fund and net flow for ETFs by computing the change in shares outstanding.
Active and passive US equity fund flows continued to move in opposite directions in September—active US equity funds saw outflows for the seventh consecutive month, and passive US equity funds collected inflows for the eighth consecutive month.
Among passive funds, all categories except commodities funds saw inflows in September, most notably US and international-equity offerings. Total passive flows were larger than total active flows for the seventh straight month.
The three active funds with the heaviest outflows during the month were PIMCO funds formerly managed by Bill Gross, which lost a little more than USD23.3 billion. Two intermediate-term bond funds that appeared to be reaping the benefits of investors seeking alternatives to PIMCO include Metropolitan West Total Return Bond, which has a Morningstar Analyst Rating of Gold, and unrated Fidelity Series Investment Grade Bond. On the passive side, Vanguard Total Bond Market Index also collected large sums of fixed-income-oriented money.