As 2011 draws to a close, many investors are continuing to seek safety, TrimTabs Investment Research said Wednesday. They are socking most of their money into bank savings accounts and bond funds.
“During the past month, more than $50 billion has flowed into bank savings accounts, and another $30 billion has gone into bond funds,” said TrimTabs CEO Charles Biderman. “Safety is the most important criteria for investors today.”
Meanwhile, they are pulling money out of gold, healthcare and China funds.
“Over the past month, $2.2 billion left the Gold ETF, not surprising since the fund is down over 5% in the month,” Biderman explained. “About $800 million left the Healthcare ETF and also the China ETF, both of which were basically unchanged in price over the past 30 days.”
The ETF with the biggest inflow over the past month was the S&P 500 Index Fund, attracting $5.9 billion, TrimTabs said. Those inflows surely supported the S&P 500’s 6% pop in price. Second was the $800 million that went into the Technology ETF, up around 3% in price. The foreign big-cap ETF also was up 3.3% in price and attracted $700 million of new money.
Biderman expects money to continue to go the way of banks and bonds—and is not optimistic about a reversal of fortune for equity funds, even though January has historically been one of the biggest months for equity fund inflows.
Lee Barney writes for Money Management Executive.