Not sure why we keep running these stories, other than it’s a car crash from which we can’t look away.
Passive beat active (again) in April, but in a bit of a bone for the latter, not by as much.
Morningstar’s monthly roundup of mutual fund and exchange-traded fund asset flows finds that investors put $17.1 billion into equity passive funds, down from $31.1 billion in March 2017.
On the active side, investors pulled $16.8 billion out of U.S. equity funds, compared with $18.6 billion in the previous month.
International equity garnered the highest total flows among equity category groups at $21.1 billion. However, taxable-bond funds continued to be the overall leader with inflows of $26 billion.
Total flows were at their lowest so far in 2017, at $43 billion. The positive flows came from predominantly international equity and taxable bond, even as the Federal Reserve is expected to continue raising interest rates.
The muni-national short category saw the largest outflows in April of $2.9 billion, all on the active side.
In a nod to “life after Bill,” PIMCO had active inflows of $2.3 billion, surpassing Vanguard, which saw $879 million of active outflows. Vanguard was the top fund family on the passive side, with inflows of $26 billion, followed closely by BlackRock with $24.9 billion in inflows.
The passive fund with the highest inflows was Gold-rated iShares Core SandP 500 ETF, which saw $6.3 billion in inflows. Gold-rated SPDR SandP 500 ETF sustained $5.5 billion in outflows.PIMCO Income, which has a Morningstar Analyst Rating of Silver, received the highest inflows of active funds in April of $2.7 billion. Recently launched Destination Funds, including Destinations Large Cap Equity and Destinations Core Fixed Income, saw the next-highest inflows of $2.4 billion and $1.3 billion, respectively. JPMorgan Core Bond had the highest outflows, $1.5 billion, among active funds.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
