Stock Fund Cash Flows Stay Positive in May

The rally on Wall Street continues to lure investors back into stock mutual funds.

Investors poured a net $12.1 billion into stock funds in May, the second straight month of inflows after outflows in nine of the previous 10 months, according to data reported Thursday by the Investment Company Institute, the industry’s chief trade group.

Fund flows measure new purchases minus redemptions.

With May’s inflow, stock funds have taken in a net $17.1 billion year-to-date. Bond funds took in a net $9 billion in May, the institute said, bringing their year-to-date inflow to $62.5 billion.

Money market funds, meanwhile, were hit by $17.8 billion in net redemptions last month, bringing their year-to-date outflow to $144.5 billion.

The pattern for June looks similar: Investors are on pace to add a net $12.2 billion to stock funds, according to TrimTabs.com Investment Research of Santa Rosa, Calif., which estimates cash flow trends. Bond funds also are seeing net inflows, TrimTabs said.