Investors in U.S. mutual funds pulled money out of U.S. equity funds for the 17th consecutive month as they continued to seek the perceived safety of fixed income funds and other non-equity plays, according Morningstar.

Overall, U.S.-stock funds have lost $82.6 billion since the beginning of this year, even though the Standard & Poor’s 500 Index is up 16.4% this year, through the end of September. “Rather than chasing returns, investors have largely ignored the equity market’s rally,” said Michael Rawson, an analyst at Morningstar and author of the September report.

For the month of September, investors added $16.5 billion to long-term open-end funds, but that was only because inflows of $29.9 billion into taxable-bond funds overcame redemptions of $16.8 billion from U.S.-stock funds.

In plowing more heavily into fixed income, investors showed a willingness to ladle on some extra risk. Higher risk categories such as emerging-markets bond funds, high-yield bond funds, and bank-loan funds each saw inflows of approximately $2 billion during September, Morningstar reported. The move toward additional risk followed the announcement by the U.S. Federal Reserve that it would strive to keep short-term rates near 0% through mid-2015.

The largest fixed-income category—intermediate-term bond—continued its dominance and collected inflows of more than $13.2 billion. Category-leading managers PIMCO Funds and DoubleLine Funds led the charge with inflows of $2.8 billion and more than $1.4 billion, respectively, into their funds.

Within equities, the carnage was widespread with nearly every category seeing outflows in September, led by large-growth equity funds which lost $5 billion for the month. Not surprisingly, but somewhat ironically, the total loss to open-end equity mutual funds of $16.8 billion in September is nearly equal to the amount that flowed into equity exchange-traded funds that month.

One lone bright spot in equities was dividend-paying funds, which have attracted $17.3 billion in assets so far this year, Morningstar noted. The group’s leading fund, the Blackrock Equity Dividend fund (MDDVX), has attracted $4.5 billion so far this year, while the Vanguard Dividend Growth fund (VDIGX) has brought in $3 billion. “Yield-hungry investors are likely drawn to the high dividend yield relative to the yield on fixed-income securities,” Rawson noted.

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