Net flows of global asset allocation funds dipped significantly in the first quarter of 2013, according to new research.
Cerulli Associates, Boston, discloses this finding in the May 2013 edition of “The Cerulli Edge: U.S. Monthly Product Trends.” The report provides monthly data on trends among mutual funds, exchange-traded funds, money market funds and new products.
The survey records net flows of global asset allocation funds of $3.8 billion at the end of the first quarter, a pace that, if maintained, will fall short of the $23.3 billion recorded 2012. However, global asset allocation funds totaled $372.1 billion, up 7 percent from the $345.6 billion recorded in 2012.
Mutual fund assets at the end of April totaled $10.1 trillion, up from $10 trillion March, a 1.1 percent increase. Over the same period, the report shows, ETFs assets grew to $1.473 trillion from $1.449 trillion, a 1.7 percent increase.
Mutual fund net flows in April totaled $38.4 billion, down from $46.7 billion in March. During the same period, ETF flows hit $8.2 billion, down from $16.1 billion.
By asset class, mutual fund assets in April broke down as follows:
- U.S equities: $3.9 trillion or 38.4 percent of the total
- Taxable bonds: $2.6 trillion or 26.1 percent
- International equities: $1.5 trillion or 15.2 percent
- Allocation: $962.4 billion or 9.6 percent
- Municipal bond: $597 billion or 5.9 percent
- Sector equity: $323.8 billion or 3.2 percent
- Alternatives: $104.6 billion or 1 percent
- Commodities: $52.1 billion or 0.5 percent
The report shows that 52 percent of asset managers classify global tactical asset allocation products as “alternatives” as opposed to “traditional” investments (48 percent). In 2012, 37 percent of asset managers flagged the products as alternatives versus 63 percent traditional.
Glob asset allocation mutual funds experienced the most product development in 2011 and 2012, with 52 new funds brought to market, the report shows.