Facts, Facts and More Facts: September 2012 Fund Industry Wrap-up

Assets of long-term mutual funds (including ETFs) expanded by $17.4 billion in September to reach $837 billion. In line with the first eight months of 2012, higher asset valuations, rather than sales, were the key growth driver.

After a slower first half compared to last year, mutual fund sales activity is showing signs of picking up. Third quarter sales easily eclipsed 2011 third quarter result. Long-term mutual funds brought in $5.3 billion in net flows versus $1.6 billion in net redemptions recorded in the same period in 2011—albeit it is worth noting last year’s result reflected the challenging equity market environment characterizing the second half of 2011.

Once again, pre-assembled advice solutions in the form of mutual funds of funds (MFoFs) delivered a solid sales result in September with net flows of $2.1 billion. Long-term stand-alone funds ended the month in net redemptions of $55 million.

On a year-to-date basis, stand-alone funds accounted for $7.8 billion or 35% of long-term mutual fund inflows, down from 40% share in the first nine months of 2011. However, in absolute terms, this year’s tally for stand-alone funds is $427 million ahead of last year’s net flow result.

ETF assets rose by $2.0 billion to end September at $53.7 billion, marking the segment’s fifth straight month of asset expansion. At $1.1 billion, net creations accounted for half of the increase. For more details, please see the upcoming issue of the Insight Advisory Service http://investoreconomics.com/issue/insight-advisory-service. Posted by Sandeep Gosal Sandeep@iei.ca.