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Lipper’s Q3 2015 U.S. Mutual Funds And Exchange-Traded Products Snapshot

By Tom Roseen Conventional Mutual Funds Summary Global markets took it on the chin over the last three months, with fears of slowing global growth, Federal Reserve tightening measures, slumping commodity prices, and drug-pricing issues sending the major indices down during the quarter more than 10% from their recent market highs. Total net assets (TNA) in the conventional funds business (not including exchange-traded products [ETPs] and variable insurance products [VIPs]) dropped below the $15-trillion mark for the first quarter in six. As a result of large declines in the price of oil and on fears of China’s slowing growth, for Q3 2015 the emerging markets funds macro-group witnessed the largest relative (-17.52%) decline in total assets under management from the prior quarter-end, while the large-cap funds macro-group suffered a decline of $152.3 billion-the largest absolute decline in total assets under management. Investors ducked for cover during the quarter and padded the coffers of money market funds. The fund group witnessed the largest relative (+1.35%) and absolute (+$30.5 billion) increase in TNA for the quarter. Open-End Funds’ (ex-ETPs’) Total Net Assets ($Mil) by Macro-Group, Rolling Quarters Through Q3 2015 (click to enlarge) Source: Thomson Reuters Lipper Exchange-Traded Products Summary On fears of slowing global growth, Federal Reserve tightening measures, and slumping commodity prices during Q3 2015, TNA in U.S. ETPs (including exchange-traded funds, exchange-traded notes, exchange-traded commodities, limited partnership commodity pools, master limited partnerships, and exchange-traded fund [ETF] unit investment trusts) dropped below the $2.0-trillion mark for the first quarter in four. For Q3 2015 the emerging markets ETPs macro-group witnessed the largest relative (-26.00%) and absolute decline (-$37.0 billion) in TNA from the prior quarter-end. The alternatives ETPs macro-group experienced the largest relative (+26.35%) increase in TNA for Q3, while the Short-/Intermediate-Term Bond ETP macro-group witnessed the largest absolute increase in TNA (+$14.3 billion) for the quarter. (click to enlarge) Source: Thomson Reuters Lipper In the complete issue of Lipper’s Q3 2015 U.S. Mutual Funds and Exchange-Traded Products Snapshot , we feature a summary of total net assets, estimated net flows, and new fund creations for conventional funds and exchange-traded products for Q3 2015, comparing those changes to prior quarters and highlighting the largest individual gainers and losers of both groups. Lipper’s U.S. Mutual Funds and Exchange-Traded Products Snapshot provides readers a powerful, easy-to-use guide and quick reference tool to help them discern fund trends for the quarter.

Volatile Trading Week Produces Somewhat Muted U.S. Fund Flows

For the fund-flows week ended Wednesday, September 2 the U.S. equity markets experienced a roller coaster ride. The Dow Jones Industrial Average experienced four triple digit move days (two up and two down) to close the week with a gain of 0.4%. This volatility was spurred on by the continued fears about the economic slow-down in China (the down days) counter balanced by strong U.S. economic data (sharply revised upwards second quarter GDP numbers) and a bounce in oil prices. Underscoring the increased volatility in the market was the increase in the CBOE Volatility Index (VIX) which spiked at greater than 30. Any value above 20 for the VIX is a warning sign to investors that the market is ripe for wide shifts in momentum. This week’s fund flow results did not reflect the up and down nature of the trading as most of the data produced was a continuation of current trends. Breaking down this week’s fund flows information by macro groups (equity funds, taxable bond funds, municipal bonds and money market funds) and by fund type (mutual funds and ETFs) we saw that all of the mutual funds groups experienced net outflows. Taxable bond mutual funds (-$4.3 billion) suffered through their sixth straight week of negative flows. Within the taxable bond fund group investors took money out of Lipper’s High Yield Funds (-$714 million) and Loan Participation Funds (-$451 million) in what can be viewed as fight to safety in this time of uncertainty. Municipal bond mutual funds and equity mutual funds also extended their recent losing streaks with their second and third consecutive weeks of net outflows, respectively. Contradicting the other groups, money market funds did reverse their current trend with outflows of over $10 billion after four consecutive weeks of net inflows which totaled almost $50 billion. There was some positive news within the ETF universe as equity ETFs (+$4.8 billion) and taxable bond ETFs (+$4.3 billion) both were the beneficiaries of sizeable net inflows. For equity ETFs it was third net inflow in four weeks as SPDR S&P 500 ETF Trust (NYSEARCA: SPY ) paced the field by taking in $7.2 billion of net new money. The inflows into taxable bond ETFs marked their third consecutive week of positive results with almost $7.3 billion net inflows during the time period. (click to enlarge) Share this article with a colleague