A report from Sterne Agee asserts that last week saw more money flow into equity mutual funds based in the United States than any week since at least October of 2000. The data comes from the data agency, EPFR Global. The total flow of money into US based equity mutual funds totaled more than $6.4 billion last week.
Despite the positive indication for Mutual Fund operating firms, the report points out that week by week data for inflows is extremely volatile. A single week of very high incomes does not mean the industry is set to grow at record pace.
The report also points out that few of the companies that garnered high inflows were publicly traded, reducing the ability to benefit from the increased incomes of the funds through exposures on the equity markets. By far the biggest gainers in the market were ETFs, which are not included in the $6.4 billion total for the week.
Including the ETF inflows, the top five beneficiaries of the most recent inflow of funds during the week were BlackRock, Inc. (NYSE:BLK), Vanguard Group Inc., State Street Corporation (NYSE:STT) Global Advisors, Invesco PowerShares Capital Management, and JPMorgan Chase & Co. (NYSE:JPM) Asset Management.
A large number of the firms on the list of beneficiaries, including all those public companies in the top 5, are due to report their earnings next week. If these firms’ mutual funds have been outperforming in recent months, it will surely be commented on in those earnings reports, particularly those of BlackRock, Inc. (NYSE:BLK).
The mutual fund inflows will be a metric to watch to see if the industry is becoming more popular going forward, and whether it is a reasonable investment opportunity.