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It’s not the only reason, but equity funds continue to see huge inflows.From Goldman’s Marc Irizarry:
Another solid week for US equity funds
Lipper FMI data suggests equity funds saw another solid week of inflows at +$4.5 bn, following last week’s +$5.8 bn, led by domestic funds. This brings 1QTD flows to +$27 bn, a run-rate of nearly +$50 bn for 1Q11, the highest quarterly rate since 1Q07. This week’s flows comprised of +$4.2 bn in domestic funds and +$0.2 bn from non-US funds. Total bond fund flows were +$2.1 bn as -$1.1 bn of muni outflows were offset by +$3.2 bn of taxable bond inflows. This compares to +$1.6 bn of inflows last week (+$3.0 bn in taxable bond funds; -$1.5 bn in munis per ICI). MMFs inflowed for the second week in a row, with +$5.6 bn, versus +$9.2 bn last week.
Equity ETFs (ex-comm) see big inflows
Equity ETFs (ex-commodities) inflowed +$5.0 bn for the current week, after three consecutive weeks of outflows averaging -$2.2 bn/week. Commodity ETFs saw inflows of +$342 mn, versus +$270 mn in the prior week. Bond ETF inflows amounted to +$401 mn (+$306 mn in taxable bonds; +$96 mn in munis), versus +$20 mn last week.
Here’s the hilarious part though
Equity fund performance
The group’s average equity fund performance 1Q11TD is +4.7%, versus the S&P500’s +6.3%, with PZN leading with +8.5% in asset-weighted equity performance. Fixed income performance for the group was +0.2%, versus the Barclays Aggregate Bond Index’ –1.0%. CLMS ranks at the top with the highest asset- weighted fixed income performance of +2.4%.