The mutual fund industry's three-month rally of robust sales tapered off in November when investors withdrew $600 million from domestic stock funds, CBS MarketWatch reports.
The news surprised some industry officials who hoped to continue strong sales in October, when stock fund inflows reached $2.2 billion. Stock funds also reported overall positive inflows in August and September.
Experts attribute the decline in sales to tax-planning strategies rather than a loss of confidence in the U.S. stock market. Historic evidence suggests investors typically avoid buying funds in the last quarter as a precaution against receiving an unwanted capital gains tax bill in the following year.
Industry officials also attribute the slowdown to winnowing retirement plan contributions because many investors reach their 401(k) contribution limits by November.

Subscribe Now

Access to premium content including in-depth coverage of mutual funds, hedge funds, 401(K)s, 529 plans, and more.

3-Week Free Trial

Insight and analysis into the management, marketing, operations and technology of the asset management industry.