Long-term mutual funds and ETPs experienced net deposits of US$58.1 billion in January, a significant improvement over the US$5.6 billion in net deposits seen in December. Passive strategies continued to lead demand among long-term funds with inflows of US$71.9 billion (including US$39.2 billion to ETPs).
While actively managed funds experienced aggregate net redemptions of US$13.7 billion, these outflows were much less severe than the US$63 billion in outflows actively managed long-term funds experienced in December.
Taxable Bonds experienced the highest net deposits among long-term funds at US$32.9 billion. Taxable Bond funds experienced net inflows in both passive (US$22 billion) and active (US$10.9 billion) segments. Tax-Free Bond funds in January experienced a rebound in net flows of US$4.4 billion after having seen net outflows of US$16.3 billion in December.
International Equity funds led Equity funds overall with US$15.3 billion in net deposits. Domestic Equity funds meanwhile saw inflows of US$5.5 billion. Equity outflows were concentrated among active products (US$28.7 billion) while passive Equity funds experienced inflows of US$49.5 billion.
Money Market funds experienced net redemptions of US$44.6 billion in January, primarily through outflows from Taxable Money Market funds. Prime Money Market funds had been the leading contributor to outflows from Taxable Money Market funds throughout 2016. In January, Prime Money Market funds saw inflows of US$5.8 billion, while Government and Treasury Money Market funds led outflows at US$30.5 billion and US$20 billion, respectively.