State Street Global Advisors lost nearly $7 billion in net outflows from its equity and bond funds in February, MarketWatch reports - with most of the money being pulled from its SPDR, according to Financial Research Corp. Of the total $6.99 billion in outflows, $6.4 billion was from the SPDR ETF.

Although retail investors have gravitated to exchange-traded funds, most of the money in them is still from institutional investors, noted FRC analyst Ross Frankenfield. "A lot of times, they [institutional investors] are using these as short-term solutions to equitize cash, and I think that's basically what's going on."

In fact, FRC data shows that while ETFs on the whole continued to take in sizeable net flows in February, their popularity is waning; they had $24.6 billion in net inflows in February, down 23% from $32.1 billion in the year-earlier period. Year-to-date through February, ETFs have netted $45 billion, down 44% from $81 billion in the first two months of 2004.

Meanwhile, American Funds continues to reign as the No. 1-selling fund group, gaining an additional $7.93 billion in February. Vanguard was the next-best seller, reaping $5.58 billion. Barclays was third, at $3.07 billion.

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