Junk mutual funds, ETFs add $3.09 billion for week ended June 26

By Abigail W. Adams

Portland, Me., June 27 – High-yield mutual funds and exchange-traded funds – considered a reliable barometer of overall liquidity trends in the junk market – saw a substantial influx of cash with $3.089 billion entering the space for the week ended Wednesday, according to fund-flow statistics generated by AMG Data Services Inc.

The inflow is the third time in 2019 inflows have topped $3 billion.

The largest inflow year-to-date was for the week ended Feb. 6 when $3.86 billion flooded the space.

Prior to that, the largest inflow in 2019 had been the $3.28 billion that entered the space for the week ended Jan. 16.

The inflow also marks the third consecutive week of inflows, reversing a growing trend of outflows.

Funds saw inflows of $602 million for the week of June 19 and inflows of $1.72 billion for the week ended June 12.

Five of the seven outflows in 2019 have occurred since late April.

The recent inflows were preceded by the record-setting outflow of $3.22 billion for the week ended June 5, which was the largest of 2019.

Junk funds saw an outflow of $1.27 billion for the week ended May 29.

While there was a modest inflow of $4 million for the week ended May 22, the inflow was preceded by what was previously the largest outflow of 2019 – $2.57 billion left the space for the week ended May 1.

The $2.57 billion outflow was preceded by an outflow of $212 million for the week ended May 8.

Funds saw a modest inflow of $21 million for the week ended May 1.

The modest inflow was preceded by an outflow of $521 million for the week ended April 24, which had been the first outflow in seven weeks.

The recent streak of inflows replenished the cumulative inflow that was dwindling due to the streak of outflows.

Cumulative fund flows in 2019 jumped to $21.63 billion for the 25 weeks thus far, according to a Prospect News analysis of the reports by the Arcata, Calif.-based unit of Thomson Reuters Corp.’s Lipper analytics division.

For the past 10 weeks, funds have seen eight inflows and two outflows.

There have been 18 inflows and seven outflows in the 25 weeks of 2019, according to the Prospect News analysis.

IG corporates see inflows

Among other asset classes, investment-grade corporate funds also saw a substantial inflow with $3.238 billion entering the space.

The inflow is the fourth consecutive week funds have added money with $3.65 billion entering the space for the week ended June 19, $4.02 billion entering the space for the week ended June 12, and $924 million entering the space for the week ended June 5.

The inflows have pared losses from the record-setting outflow of $5.1 billion that left the space for the week ended May 29.

The outflow was the largest since 2015, according to a market source.

High-grade funds also saw $756 million leave the space for the week ended May 22.

Prior to that, funds had seen a steady streak of inflows.

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