Fund investors cautiously returning to stock funds

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Investors are cautiously creeping back into stock mutual funds. They added a net $1.47 billion to stock funds in the week ended Aug. 17, the Investment Company Institute said Wednesday.

That followed a pullout of more than $30 billion from stock funds the week prior when fears about the global economy intensified.

At the same time, investors continued to take their money out of bond funds. All told, they withdrew $772 million from mutual funds for the week.

Notably, the week marked the first time there’s been a net inflow of cash to U.S. stock funds since April. Domestic stock funds grew by $1.1 billion and foreign stock funds took in $345 million. The four-week moving average for stock funds, a less volatile measure of fund flows, still showed an average weekly outflow of $12.7 billion ? a slight decrease from the previous week’s $14.8 billion.

Investors pulled a net $3.1 billion from bond mutual funds, compared to previous week’s outflow of $4.35 billion. This marks the fourth consecutive week that investors took their money out of bond funds. That reversed a trend of them seeking shelter in bond funds since January. The four-week moving average for bond funds increased to an average weekly outflow of $2.6 billion.

Hybrid funds, which invest in both stocks and bonds, had estimated inflows of $874 million for the week, compared with outflows of $5.89 billion in the previous week.

Estimated mutual fund flows in millions of dollars.

Hybrid funds are able to invest in stocks and fixed-income investments.

Source: Investment Company Institute