The mutual fund scandal and recently volatile market conditions have failed to halt the industrys continued runaway growth this quarter. Investors added more than $135 billion into equity and balanced mutual fund during the quarter despite the epidemic of scandals that continues to cast a pall over the industry. Strategic Insight, a New York-based mutual fund consulting firm, notes that early estimates of inflows into mutual funds during the first quarter are projected to set a record for industry. The recent surge of inflows into stock and balanced funds exceeded a record set during the bullish first quarter of 2000. "These record pace of stock fund inflows, even during periods of stock price retreat, continues to reflect optimism in the American and global economic expansion, as well as sustained confidence in the mutual fund vehicle," said Avi Nachmany, director of research at Strategic Insight. The majority of mutual funds inflows last quarter mainly enriched stock and balanced funds. Bond funds absorbed only $11 billion during that period. Recent inflow figures collected by Strategic Insight include assets found in closed-end funds, exchange-traded funds and variable annuity sub-accounts.
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