Money market funds provided the major part of a 1.6% boost in mutual funds during the second quarter, according to data the Investment Company Institute released Monday.
Worldwide assets hit $19.41 trillion this quarter, despite a 53% drop in net new cash flow between the first and second quarters. Much of the $206 billion in new cash during the second quarter came from money market funds, with inflows of $71 billion, or more than double that of first quarter.
In the U.S., money market funds enjoyed a significant boost over last quarter, with $58 billion in inflows, compared to only $5 billion in the prior quarter. Long-term funds received $135 billion in new cash, a drop of about 66% from the period before.
American and European equity funds especially saw less with $73 billion in new cash compared with $246 billion in the first quarter. Investors in Asia/Pacific and Africa funds remained consistent, adding $41 billion.
Still, year to date, net flows to all funds is up from slow-moving 2005 by $262 billion.
For foreign funds, a weak U.S. dollar helped counter negative stock performance. In fact, in Europe, those funds denominated in the USD increased 3.6%, compared to those measured in other currencies, which, in aggregate, fell 1.4%.
Equity funds fared worst during the second quarter, slipping 0.5%, compared to bond funds, which rose 1.3%, money market funds, gained 4.2% and balanced/mixed funds grew the most, growing 5.0%.
Bond funds, likewise, suffered with a $5 billion net outflows, mainly in the European, African, Asian and Pacific markets. In the U.S. Bond funds gained $13 billion in new money.