Retail cashflow for U.S. high-yield funds were positive $1.5 billion in the week ended Oct. 15, according to Lipper. That’s up from an inflow of $735 million last week, and it’s the largest one-week infusion in 27 weeks, or since an inflow of $1.4 billion in the week ended April 8.
Moreover, the net inflow was squarely positive, albeit heavy on the ETF segment, at $1.1 billion on top of the $378 million inflow to mutual funds. This is the first week of this dual-positive measure in 19 weeks, or since the week ended June 3, which had $570 million of mutual fund inflows ahead of a $31 million inflow to the ETF segment. In contrast, it’s been inverse in recent weeks, with outflows from mutual funds against inflows to ETFs, suggesting market-timing, hedging strategies, and fast-money investors in the asset class.
Regardless, the net flow figure is robustly positive and thus flips the trailing-four-week average back into the black, at positive $378 million per week, from negative $291 last week and from negative $428 million two weeks ago.
The full-year reading is reduced to negative $2.8 billion, with an inverse 28% related to ETFs, or with $3.6 billion of mutual fund outflows countered by $780 million of inflows to the ETFs. Last year, after 41 weeks, there was a net outflow of $5.5 billion, with 19% of the withdrawal tied to ETF redemptions. Recall that last year’s sum total outflow at this point in the year included the all-time record $7.1 billion outflow in the week ended Aug. 6, 2014.
The change due to market conditions last week was modestly positive, at $666 million amid the mild market rebound, which was primarily in the second half of last week. That’s not very much, at just about 0.4%, against total assets, which were $188.5 billion at the end of the observation period.
Take note that a change due to market of negative $3.2 billion two weeks ago, or nearly negative 2% amid the market sell-off, was the largest one-week plunge in 120 weeks, or roughly 2.3 years, dating to a $3.7 billion deterioration in the week ended June 26, 2013.
At present, ETFs account for $36.2 billion of total assets, or roughly 19% of the sum. — Matt Fuller