Lipper fund flows – adjustment to chart
In yesterday’s video I discussed the Lipper fund flows and said that “lipper us fund flows reported Equity Fund (including ETF) outflows of -$16.6 Billion in the week to 26th of October. That’s the largest single weekly outflow since w/e 08/28 2015. The 4wk flow is a negative -$32.5 Billion, which is an extremely low number”.
I also said that a 4wk flow number like that is “more akin to a market low than the current situation” and that “it seemed at odds with other current sentiment readings”.
Looking into this a little more over the weekend I note comments from Thomson Reuters as follows:
U.S. Weekly FundFlows Insight Report:
For Equity Mutual Funds, It’s Not as Bad as the Headlines Look.
Net redeemers of equity funds (-$16.6 billion, their largest net redemptions since the week ended September 9, 2015). However, just under $11.7 billion of those equity outflows could be attributed to the liquidation of the Vantagepoint Funds, in which ICMA-RC restructured its proprietary funds to a collective investment trust (CIT) structure.
The words “could be” are a bit guarded but for now I am going to adjust the number from -$16.6 Billion to -$4.9 Billion which brings the 4wk flow number to -$20.80 Billion and not -$32.5 Billion – i.e. less of an extreme.
I’ll stay in touch with this and keep you informed.
click chart to enlarge
Thomson Reuters Lipper U.S. fund flows provide net flows for more than 75% of mutual funds. I chart the net weekly flow of Equity Funds (including ETFs) each week and plot a four week flow number (summation) on the chart as a black line. As with most sentiment indicators this measure is interpreted in a contrarian fashion, e.g. negative extremes in sentiment will often be recorded close to market price lows.