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Bob Carey
Chief Market Strategist
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  A Snapshot Of Equity Fund Flows
Posted Under: Conceptual Investing
Supporting Image for Blog Post

View from the Observation Deck  
  1. Today's blog post is intended to be an FYI of sorts in that we simply want to show how investors have been positioning their capital with respect to equity style and market capitalization (cap).
  2. Year-to-date through 5/31/20, only three of the categories in the table (Foreign Large Blend, Foreign Large Growth & Small Value) registered net inflows, with the lion's share of the capital flowing to Foreign Large Blend.  
  3. For the 12-month period ended 5/31/20, once again, only three categories (Large Blend, Foreign Large Blend & Foreign Large Growth) reported net inflows, with Large Blend and Foreign Large Blend garnering nearing all of the money. 
  4. When you factor in the bear market in stocks in Q1'20, it is understandable that the year-to-date equity fund flows are predominantly negative, so the 12-month flows may be helpful in lending some additional perspective on investor sentiment.  
  5. Despite the significant net outflows from most stock fund and exchange-traded fund (ETF) categories year-to-date, the S&P 500 Index and most major stock indices have rebounded notably since stocks bottomed on 3/23/20.
  6. As of the close on 6/15/20, the S&P 500 Index stood 9.44% below its all-time high (3,386.15) set on 2/19/20, according to Bloomberg. Keep in mind, the index plunged 33.92% from 2/19/20-3/23/20.
  7. The most recent money manager survey from Bank of America revealed that 78% of those managers polled believe the stock market is currently overvalued, according to Bloomberg. That is the highest percentage since 1998. A little over one out two managers think we are experiencing a bear market rally. 
This chart is for illustrative purposes only and not indicative of any actual investment. 

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Posted on Tuesday, June 16, 2020 @ 1:28 PM • Post Link Print this post Printer Friendly

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.
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