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Rating:Active Inflows Fall 40 Percent, and Passive Falls, Too, But ... Not Rated 5.0 Email Routing List Email & Route  Print Print
Friday, August 27, 2021

Active Inflows Fall 40 Percent, and Passive Falls, Too, But ...

Reported by Neil Anderson, Managing Editor

Active funds' inflows fell by 40 percent, and passive inflows fell by 29 percent ... despite a 59 percent increase in passive inflows at a low-cost leviathan.

Mortimer J. "Tim" Buckley
Vanguard
President, CEO
This article draws from Morningstar Direct data on July 2021 open-end mutual fund and ETF flows, excluding money-market funds and funds of funds. The data also excludes other asset management products, like SMAs and CITs.***

BlackRock took the lead last month on the active side, thanks to an estimated $3.024 billion in net July 2021 inflows, down month-over-month from $3.163 billion in June 2021 and down year-over-year from $3.136 billion in July 2020. Other big July 2021 active inflows winners included: TIAA's Nuveen, $2.887 billion (up M/M from $1.252 billion, up Y/Y from $105 million); J.P. Morgan, $2.719 billion (down M/M from $3.969 billion, down Y/Y from $5.401 billion); Vanguard, $2.232 billion (down M/M from $3.609 billion, down Y/Y from $4.548 billion); and Lord Abbett, $1.989 billion (up M/M from $1.847 billion, up Y/Y from $1.425 billion).

Vanguard kept the lead yet again on the passive side, thanks to an estimated $34.197 billion in net July 2021 passive inflows, up M/M from $21.562 billion in June 2021 and up Y/Y from $5.61 billion in July 2020. Other big July 2021 passive inflows winners included: Fidelity, $11.076 billion (down M/M from $14.92 billion, up Y/Y from $3.31 billion); BlackRock, $6.824 billion (down M/M from $17.263 billion, down Y/Y from $18.532 billion); Charles Schwab, $3.593 billion (down M/M from $4.008 billion, up Y/Y from $684 million); and KraneShares, $1.91 billion (up M/M from $599 million, up Y/Y from $341 million).

On the flip side, last month was a rough one for Fidelity's active mutual funds, which led the active outflows pack thanks to an estimated $3.516 billion in net active July 2021 outflows, down M/M from $1.043 billion in June 2021 active inflows and down Y/Y from $3.738 billion in July 2020 active outflows. Other big July 2021 active outflows sufferers included: Franklin Templeton, $3.435 billion (down M/M from $695 million in net inflows, up Y/Y from $2.047 billion); T. Rowe Price, $2.344 billion (down M/M from $3.639 billion, up Y/Y from $382 million); Ark, $1.535 billion (down M/M from $994 million in net inflows, down Y/Y from $1.49 billion in net inflows); and Payden, $1.053 billion (up M/M from $21 million, down Y/Y from $85 million in net inflows).

Invesco led the outflows pack on the passive mutual fund side last month, thanks to an estimated $2.149 billion in net passive July 2021 outflows, down M/M from $6.029 billion in June 2021 passive inflows and down Y/Y from $2.089 billion in July 2020 passive inflows. Other big July 2021 passive outflows sufferers included: SSGA, $1.66 billion (down M/M from $10.598 billion in net inflows, up Y/Y from $1.24 billion); USCF, $371 million (down M/M from $385 million, down Y/Y from $769 million); Ameriprise's Columbia Threadneedle, $290 million (up M/M from $102 million, up Y/Y from $118 million); and SEI, $287 million (down M/M from $414 million, up Y/Y from $6 million).

Industrywide, the 709 active fund firms tracked by the M* team (up M/M from 703 in June 2021 and up Y/Y from 708 in July 2020) brought in an estimated $14.693 billion in net active inflows in July 2021, accounting for 20 percent of overall industry long-term inflows. That's down from $24.587 billion and 23 percent in June 2021, but it compares with $12.052 billion and 29 percent in July 2020. 389 firms gained net active inflows in July 2021, down M/M from 401 but up Y/Y from 198.

The 149 passive fund firms (up M/M from 148 and up Y/Y from 141) tracked by the M* team brought in an estimated $57.431 billion in net passive inflows in July 2021, accounting for 80 percent overall industry long-term inflows. That compares with $80.917 billion and 77 percent in June 2021 and $29.381 billion and 71 percent in July 2020. 77 firms gained net passive inflows in July 2021, down M/M from 94 but up Y/Y from 71.

*** This caveat is particularly important for the largest fund firms, many of which are big players in the 401(k) business, where collective investment trusts (CITs) are a commonly used alternative to traditional mutual funds. For example, as the T. Rowe team revealed on August 11, in July 2021 their clients transferred about $300 million out of T. Rowe mutual funds and into other T. Rowe products like CITs and SMAs. (T. Rowe clients made $15.1 billion of such transfers in the first seven months of 2021). And T. Rowe is a big retirement plan provider and DC I-O asset manager, especially in the target-date fund (TDF) space. 

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