Mutual Funds See Worst Start Of Year In More Than A Decade

All but one of the 25 largest US mutual fund managers saw their long-term assets fall in the first quarter, as returns dived and investors pulled out of funds.

In the worst start to a year for more than a decade, most money managers had retail outflows, and even stalwarts such as American Funds and Vanguard suffered a drop in assets, of 6.6 per cent and 4.3 per cent respectively.

Pimco, the bond manager, was the only one to show a rise in retail assets, according to Financial Research Corporation and industry estimates. Pimco's Total Return fund had an inflow of $9bn in the three months to March.

The trend is likely to worry economists, because it suggests the credit turmoil is hurting the confidence of mainstream investors. That, in turn, could dampen activity among consumers in the months ahead, since falling investment sentiment is often associated with muted household spending levels.

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Comments

[FreedomCorpse]

This story is going to be repeated time and time again for the next couple of years, my precious metals will do wonderfully as America's economy circles around like a turd with horrible government flushing it.

[gakabani]

The issue is not Mutual Funds per se but the loses associated to them in this time of crisis. The lack of transparency makes me realize that the financial system in the US is no more corrupt than that of any third world country.