Bond Funds Dominate Mutual Fund Inflows through June

Flows into U.S. mutual funds reached $13.5 billion in June, according to data from Morningstar.  

Mutual funds saw inflows in five of the last six months, gathering $166.7 billion in the first half of 2010 – about 24% higher than total inflows for the same period in 2009.   

Investors added $17.6 billion to taxable-bond funds in June, bringing the total inflows to $119.6 billion during the first two quarters of 2010. Municipal-bond funds took in nearly $2 billion in June and $19.5 billion for the year-to-date period.   

Despite the year-to-date losses sustained by the MSCI EAFE Index and continuing worry about the downturn in foreign stocks, year-to-date inflows for international-equity funds reached $19.6 billion, while domestic-stock funds experienced outflows of nearly $17 billion, Morningstar said.  

Alternative mutual funds, many of which were launched since the credit crisis, have recorded record inflows. PIMCO Fundamental Advantage Total Return has the led the way, taking in nearly $3.3 billion over the past 12 months through June.   

Money market funds have lost $790.5 billion in assets over the past 12 months, with almost 80% of those outflows coming from institutional share classes.   

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