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Money Management Executive

Funds Lose Record $20.6 Billion in March

Published April 30, 2001, 1:00 a.m. EDT
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A record $20.6 billion flowed out of stock mutual funds in March, the largest one-month outflow in dollars and the fourth largest outflow in percentage of assets, according to the Investment Company Institute of Washington D.C.

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Funds Lose Record $20.6 Billion in March

A record $20.6 billion flowed out of stock mutual funds in March, the largest one-month outflow in dollars and the fourth largest outflow in percentage of assets, according to the Investment Company Institute of Washington D.C.

The outflows amount to 0.56 percent of total assets and made March the worst month for outflows since November 1988 when outflows amounted to 1.61 percent of total assets, according to the ICI.

Domestic equity funds recorded net outflows of $15.72 billion in March, the first time the category has recorded net outflows since August 1998, according to the ICI.

Flows for taxable bond funds and municipal bond funds were positive in March, but down from the previous month by $9 million and $851 million, respectively.

Although stock fund net flows for the first three months of 2001 amounted to $1.2 billion, stock fund flows are down $139 billion from the same period the previous year, according to ICI figures.

'This is typical shareholder reaction to downward markets,' said John Collins, an ICI spokesperson. Usually in downward markets, shareholders increase redemption activity and sales slow, he said. However, March’s outflows are small compared to the amount of overall assets held in funds and shareholders do not appear to be panicking, he said.

Total assets held in funds dropped 3.8 percent to $6.637 trillion in March.


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