Investment Flows: Where is the Money Going?

EPFR Global tracks flows into mutual funds. It reports that in the week through Wed Aug 26 investors put $168 mln into Asia x-Japan funds after the previous week recorded the largest outflow (~$810 mln). Data from the local stock exchanges suggest that foreign investors have been net sellers of Philippine shares this month. South Korea has been among the largest draws, pulling in $3 bln this month and a little more than $15 bln year to date. Interest in Taiwan began off slowly but has come on stronger as the month progressed. The stock exchange says foreign investors bought $798 mln of Taiwanese shares this week, but only $239 in the month.

Separately, funds dedicated to Chinese shares received $480 mln and the previous week saw the biggest net outflows since Q1 08. Diversified EM funds took in $381 mln and Latam funds $218 mln. EMEA funds saw net inflows of $45 mln. Japanese equity funds saw their biggest inflow in nearly a year as $230 mln.

EPFR reports strong flows into US bond funds continue, taking in more than $2 bln for the fourth consecutive week. The bias in this space is muni bonds and short-term bond funds.

US equity funds experienced net inflows for the fourth time in five weeks. Large cap ETFs accounted for the lion's share of the $4.77 bln inflows. Mutual funds in the mid-cap space seemed to draw the most among the actively managed funds. For the sixth consecutive week, EPFR says US large cap and mid cap funds with a value style drew greater inflows than growth style funds.

European funds took in $381 mln and have seen net inflows for six consecutive weeks. Funds dedicated to Germany and the UK were the hottest. Global equity funds took in $1.25 bln and also have experienced net inflows for the past six weeks

If this sketches out where money is going, where is it coming from ? In the week through Aug 26, liquidation of money market funds were $5.75 bln and its was the 8th time in 9 weeks, there were net redemptions. Year-to-date some $250 bln has left money markets, which is more than 50% of last year's inflows.
Investment Flows: Where is the Money Going? Investment Flows:  Where is the Money Going? Reviewed by magonomics on August 28, 2009 Rating: 5
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