Officials prepare for the opening of the Nasdaq stock market. (Stephen Chernin / Getty Images) |
Money is pouring into bond mutual funds at a feverish pace at the start of the new year.
Net inflows into global bond funds hit $6.4 billion in the week ended Jan. 11, an 82-week high, according to fund tracker EPFR Global in Cambridge, Mass.
Money typically flows into mutual funds at the beginning of the year for both emotional and practical reasons. Investors often feel more optimistic as the calendar turns, and they need to allocate money from year-end bonuses.
In keeping with investors’ cautious outlook in recent years, virtually every type of fixed-income fund had inflows. Municipal funds led the way, experiencing their biggest influx of fresh cash in more than two years.
"Retail investors seemed to be playing catch-up after a year when they heeded dire predictions for this asset class that have yet to materialize," said Cameron Brandt, EPFR’s global research director.
Flows into global bond funds reached a 31-week high, while high-yield funds added nearly $2 billion. Even European bond funds had net inflows for the first time in 17 weeks, despite the continent’s debt crisis.
The new year also is starting favorably for stock funds, which added more than $6 billion. Emerging-market equity funds, accounted for $1.8 billion of that gain.
One trend that stayed in place: Yield-hungry investors continued to stuff money into dividend-oriented funds. Since the beginning of 2012, dividend funds have suffered outflows only eight weeks, according to EPFR.
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Net inflows into global bond funds hit $6.4 billion in the week ended Jan. 11, an 82-week high, according to fund tracker EPFR Global in Cambridge, Mass.
Money typically flows into mutual funds at the beginning of the year for both emotional and practical reasons. Investors often feel more optimistic as the calendar turns, and they need to allocate money from year-end bonuses.
In keeping with investors’ cautious outlook in recent years, virtually every type of fixed-income fund had inflows. Municipal funds led the way, experiencing their biggest influx of fresh cash in more than two years.
"Retail investors seemed to be playing catch-up after a year when they heeded dire predictions for this asset class that have yet to materialize," said Cameron Brandt, EPFR’s global research director.
Flows into global bond funds reached a 31-week high, while high-yield funds added nearly $2 billion. Even European bond funds had net inflows for the first time in 17 weeks, despite the continent’s debt crisis.
The new year also is starting favorably for stock funds, which added more than $6 billion. Emerging-market equity funds, accounted for $1.8 billion of that gain.
One trend that stayed in place: Yield-hungry investors continued to stuff money into dividend-oriented funds. Since the beginning of 2012, dividend funds have suffered outflows only eight weeks, according to EPFR.
RELATED:
U.S. bank failures declined in 2011
Risky mutual funds don't make the stock market volatile
New York Stock Exchange faces rejection" href="http://www.latimes.com/business/money/la-fi-stock-exchange-deal-20120111,0,4023044.story" target="_top">German bid to buy New York Stock Exchange faces rejection
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