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Stock Mutual Fund Cash Inflows Slow

August 31, 2000|(Josh Friedman)

Investors continue to pour money into stock mutual funds, but with a bit less glee.

Net new cash flows into U.S. equity funds slowed to $17.6 billion in July from $22.1 billion in June, the Investment Company Institute said Wednesday. Many fund companies said August flows are on a similar pace as July.

July's fund choices signaled a more conservative investing public. Net cash flow to aggressive growth funds dipped to $6.6 billion from $9.7 billion in June, the ICI said. Sector funds, which focus on specific industry groups such as technology, got $1.9 billion, versus $4.5 billion in June.

Meanwhile, money market funds took in a net $30.7 billion in July, versus an outflow of $23 billion in June, the trade group said.

Bond funds had a net outflow of $726 million in July, after a June inflow of $493 million.

As for August, Janus Capital's equity funds appear to be seeing some of the sharpest drop-offs. A spokeswoman said its stock funds took in $353 million through Friday, versus $1.9 billion for all of July. Many of its funds have lagged the market in performance this year after shining in the late 1990s, and seven of its 16 stock funds, including such stars as Janus Worldwide, are closed to new investors.

Charles Schwab, whose supermarket includes outside funds as well as its own line, estimates an inflow of $1.9 billion, on par with July.

Fidelity Investments said equity fund flows will be flat this month after an outflow of $300 million in July.

T. Rowe Price Associates said equity fund flow will be positive in August. A spokesman said growth stock funds still are luring more cash than value stock funds, but investors are "broadening their purchases to small- and mid-cap funds as well as big-cap."

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