Investors dropped almost $44 billion into open-end mutual funds in July, bringing the year-to-date total for inflows to $171 billion, according to data released by Morningstar. Taxable bond funds were the overwhelming favorite, taking 59%, or $26 billion of July’s proceeds.

Investors continued the love affair they’ve carried on with intermediate- and short-term bonds since January; in fact, almost half of the proceeds to taxable bond funds went to intermediate-term funds. About $22 billion has gone into the short-term bond category this year, which is 10 times the amount that investors allocated to the category during the same period in 2008. This suggests “although investors are coming back, they are still exhibiting a hunker-down mentality,” said Sonya Morris, an analyst and editorial director at Morningstar.

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