Money Flows Into Funds at Feverish Rate : Investments: Trade group says investors are putting bulk of money into aggressive mutuals.

Individual investors poured money into stock mutual funds in August nearly as fast as they did in July, when more new sales were recorded than in any one-month period in almost a year.

Bond fund sales are positive for a second straight month, marking a reversal from earlier this year when money consistently left fixed-income funds, companies said.

The Investment Co. Institute, the fund industry’s trade group, on Tuesday reported that investors purchased a net $13.9 billion worth of stock funds in July, up from $8.2 billion in June. July’s sales were the highest since August, 1994, the ICI said. This month’s results won’t be reported until the end of September.

But several fund companies said August sales were almost keeping pace with July’s. Fidelity Investments, the nation’s largest fund company, said its July stock fund sales were the strongest this year, totaling $2.9 billion. “August is our third best month with about $2.24 billion in new stock fund sales,” said Marilyn Morrison, Fidelity’s spokeswoman. April sales were the second highest this year.

Vanguard Group, the nation’s second-biggest fund company, said stock fund sales rose to $1 billion in August from $950 million in July. Charles Schwab Corp. said about $800 million worth of fund shares were purchased through its discount brokerage operation, down from $900 million in July.

Some analysts raised concerns that the huge amounts of money funneling into stock funds is a sign of how frothy the market has become.

Meantime, about $41.9 million worth of bond funds were bought in July, compared to net withdrawals of $3.3 billion in June, the ICI said.

Americans are putting the bulk of their money in aggressively managed stock funds that invest much their assets in more speculative, small-sized companies.

“The surge into aggressive growth funds means investors remain very bullish about the market’s outlook,” said James Solloway, research director at Argus Research Corp.

* INVESTOR SPOTLIGHT

A chart of monthly net new cash flows into bond and equity mutual funds. D8