Mutual Fund Outflows..........

[FinanceDude]

Interesting Article.............

[url]http://news.morningstar.com/article/article.asp?id=171894&fsection=Comm5 [/url]

 

[Telly]

Thanks for the link.  I've got the two American Funds, no plans to bail.  It's interesting that the Vanguard S&P 500 Index fund is way up on the list for outflow.  Probably people unhappy with 2005 performance, and now chasing performance of emerging markets or something like that.

 

[dmpi]

I'm also supprised that an S&P 500 fund has a outflow. Maybe this is a reflection on how many S&P 500 funds there are. The numbers are growing, and they all compete against each other. Also there is SPY stock. hard to compete against that.

 

[FinanceDude]

SPY (spyders) are 40 PERCENT of daily volume on the AMEX..............

 

[ats5g]

A quick review of the 6/30/06 Semi-annual reports for VFINX and VTSMX show the net purchases/redemptions for each fund:

VFINX:
Investors shares:  $(3,822,180,000)
Admiral Shares: $1,756,984,000

Total: $(2,065,196,000)

VTSMX
Investors shares:  $3,310,291,000
Admiral Shares: $1,894,715,000
Instituational: $510,022,000
ETF: $(89,743,000)

Total: $5,625,285,000

So, I guess it could be that investors getting rid of their VFINX in favor of VTSMX, like the article suggests.

- Alec

 

[TromboneAl]

Wait. Are you saying that for investor shares, net flow is out, and for admiral shares, net flow is in?

Could it be that they are including conversions from investor to admiral shares (and the admiral cutoff changed about a year ago, yes?)?

 

[ats5g]

Wait.  Are you saying that for investor shares, net flow is out, and for admiral shares, net flow is in?

Could it be that they are including conversions from investor to admiral shares (and the admiral cutoff changed about a year ago, yes?)?

Yes, Al, that's what the Semi-annual reports for VFINX and VTSMX appear to show [See Statement of Changes in Net Assets].

It is certainly possible that Vanguard is including conversions from investor to admiral.

- Alec