Investors Continue to Withdraw Monies from Equity Mutual Funds

 

For the seventh straight month, equity mutual funds reported net outflows (investor withdrawals). For the week ended November 30, equity mutual funds’ net outflows consisted of $6.67 billion from domestic equity funds and $2.96 billion from foreign equity funds, according to the Investment Company Institute, the national association of U.S. investment companies (i.e., mutual funds). Overall, U.S. mutual funds lost $9.24 billion to withdrawals last week, the most in almost two months. (See InvestmentNews: “Mutual problem as stock fund investors still heading for the exits”).

The outflows appear to be driven by concerns about Europe’s debt crisis, slowing economic growth around the world and the volatility in the equity markets.

Meanwhile, bond mutual funds are gaining funds. Investors deposited $1.16 billion into bond mutual funds last week. The deposits consisted of $709 million into taxable-bond funds, and $449 million into municipal bond funds, which are exempt from federal income taxes and some states’ taxes.

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