Bond funds netted redemptions of $59 billion (excluding exchange-traded funds) last month, according to Strategic Insight.
The most significant net redemptions (as percent of assets managed) were experienced among high-yield corporate, high-yield tax-free, GNMA, TIPs, emerging market debt, and long- and intermediate duration US government bond funds.
“The high redemptions among bond funds during June should be reviewed as an aberration,” stated Avi Nachmany, Strategic Insight’s director of research.
“Historically, stock or bond fund redemptions driven by sharp price corrections have always been limited in magnitude, short in duration (a few days, a few weeks), and non-recurring. Similarly, bond fund flow activity moderated in July and modest bond fund inflows to selected categories would resume during 2H’13.”
On the contrary, stock funds continued to attract net inflows in June, setting a new flows record for intake at $158 billion. The previous record for first half stock fund flows was set in 2004 with $155 billion, according to SI.