ETF Sales Down 25%

Sales of exchange-traded mutual funds--known as ETFs--are falling in tandem with the stock market.

ETFs recorded net sales--the value of shares issued minus the value of shares redeemed--of $2.58 billion in July, according to the Investment Company Institute.

That was 25% below the $3.43 billion investors added to ETFs in June.

Exchange-traded funds are similar to index mutual funds, but their shares trade all day like stocks.

Traditional mutual funds also are seeing a falloff of investor interest.

According to some preliminary estimates, stock funds suffered net redemptions in July--meaning investors took more money out of equity mutual funds than they put in. If verified by ICI’s official numbers, that would mark the first monthly net outflow of money from stock funds since March.

The number of exchange-traded funds increased to 91 in July from 85 in June, and their combined assets slipped to $75.52 billion from $75.56 billion, ICI said.

The largest fund, the SPDR Trust Series I, which tracks the Standard & Poor’s 500 index, has $28.3 billion in assets.