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Domestic equity fund flow decelerates and is below average for the week

Domestic equity 04.05.2013Enlarge GraphThe Investment Company Institute’s (ICI) tally of domestic equity mutual fund flow was below the important 12 week average in the most recent week and was also a deceleration from the week prior exhibiting some investor exhaustion.

For the five day period ending March 27th, the ICI has reported that domestic stock funds (U.S. based mutual fund operations that invest in U.S. stocks) took in $958 million in new investor money. This result was below the 12 week average of $1.9 billion and also a decline from the $1.2 billion result the week prior. While domestic stock fund trends have rebounded from two negative weeks of outflow at the end of February and the start of March, current trends are nowhere near as robust as the weeks that marked the start of 2013. The start of the year produced weekly flow between $3.0-$7.0 billion which puts some perspective on the newest $900 million plus subscription just reported by the ICI for the third week of March.

YTD domestic equity 04.05.2013Enlarge Graph

 

Despite these decelerating trends for the domestic equity category, the year-to-date tallies for 2013 are quite impressive and mark the best start to any annual period this cycle. For the 12 weeks in 2013, equity funds have taken in $23.4 billion, a drastic improvement from the first 12 weeks that marked 2012 which had investor withdrawals of a negative $12.5 billion. In fact, 2013 has been the one of the only positive starts for domestic equity fund flows in the past five years, with the first 12 weeks of 2008, 2009, and 2010 also dramatically negative for fund flows. Only 2011 had positive flow for the first quarter bringing in $9.3 billion in the first 12 weeks, well under half of the production thus far this year.

The leading public stock fund managers that benefit from the robust start in domestic equity flows include T Rowe Price (TROW), Janus Capital (JNS), and Invesco (IVZ).