US Monthly Fund Highlights - August 2016

Net new flows to long-term mutual funds and ETPs totalled US$28.2 billion in August. Active and passive strategies experienced divergent trends in net investments. Passive funds led demand with US$42.1 billion (including US$27.5 billion to ETPs), while actively managed funds experienced aggregate net redemptions of US$14 billion in August. 

Taxable Bond funds saw the strongest demand among long-term funds, attracting US$27.7 billion of net inflows. The space’s year-to-date flows of US$146.3 billion represent a substantial increase over the US$49.4 billion seen during the first eight months of 2015. Taxable Bond flows in August were fairly evenly split between active and passive strategies, as active funds experienced net investments of US$14.7 billion and passive funds gathered net flows of US$13 billion.

Active US and International/Global Equity funds saw outflows of US$35.6 billion in August, while index equity exposures attracted net inflows of US$28.8 billion. Net outflows among active funds were driven by redemptions in large capitalization strategies. Non-Traditional strategies including Alternatives, Commodities, and Real Estate gathered positive net flows among active funds in August.

Net deposits into Money Market funds in August totalled US$14.2 billion. The bifurcation in demand within this space continued, driven by the soon-to-be-enacted regulation. Taxable Money Market funds garnered US$44.6 billion of net inflows, while Tax-Free Funds experienced US$30.4 billion of net withdrawals. An even greater divergence continued to exist within the Taxable Money Market segment, as government money market funds saw net deposits of US$150 billion in August while prime money market funds experienced net redemptions of US$126 billion.