SUMMIT, N.J. -- Net mutual fund flows were about $25 billion in August, with more than 80% going into money market funds, according to Lipper Inc., a data analysis company.
Longer-term bond funds experienced net outflows in nearly all investment objectives, taxable and tax-free, Lipper reports.
Growth funds continue to garner the most new assets, with $3.7 billion flowing in during August. About $1.4 billion in net flows went into index funds linked to the Standard & Poor's 500 index, which were the most popular vehicle earlier in the year, according to Lipper. Science and technology equity funds received about $1.3 billion in net new assets during August.
Short investment-grade debt funds experienced a 5% flow of net new assets in August, topping all other non-equity fund types, Lipper reported.
Payden & Rygel offers European growth fund
LOS ANGELES -- Payden & Rygel Investment Counsel Inc. has launched a European Aggressive Growth Fund, which will invest in European companies with capitalizations between $500 million and $1 billion and emphasize the financial services, health care, biotechnology, information technology and telecommunications sectors.
With the European fund, Payden & Rygel expects total annualized returns of 10% to 15% for the next five years, compared with returns of 6% to 8% in the U.S. market, said Joan Payden, chief executive officer.
Mutual fund costs have declined over time
WASHINGTON -- Increased sales of institutional and index mutual funds has contributed to the decline in overall costs, according to the Investment Company Institute in its new study Mutual Fund Costs, 1980-1998.
Total shareholder cost for all equity mutual funds, measured as a sales-weighted average, declined 40% between 1980 and 1998.
Institutional funds made up 15% of total equity fund sales in 1998, compared with 0.2% in 1980, the report states. Institutional funds generally require higher minimum balances than retail funds; the higher the balance, the lower the cost. The shift in sales toward institutional reduced the sales-weighted average total shareholder cost of all equity funds, ICI reported.
Index funds, which are also less costly, accounted for 9.9% of all equity fund sales in 1998 compared with 0.6% in 1980.
American Century funds added to Fidelity's FundsNetwork
BOSTON -- Forty-five American Century mutual funds have been added to the FundsNetwork supermarket program of Fidelity Investments, Boston. They are offered without a transaction fee. Funds included in the deal are American Century Ultra, International Growth, and Income and Growth.
Wayne Hummer opens CorePortfolio Fund
CHICAGO -- Wayne Hummer Investments has opened the CorePortfolio Fund. The passive fund's proprietary model creates a portfolio of the largest companies in each of the 11 economic sectors in the S&P 500. The firm's analysis of historic returns showed a repetition of excess returns by those companies.
Thomas J. Rowland and David D. Cox are the fund's managers.
Sentinel opens growth fund for DC plans
MONTPELIER, Vt. -- Sentinel Growth Index Fund opened Sept. 15 for defined contribution plans. The fund will match the composition of the S&P/BARRA Growth index, which holds 125 stocks. The manager will be Robert Lee of Sentinel Advisors.
GE Funds decides to rename share class
RICHMOND, Va. -- GE Funds is renaming its Class D shares Class Y to be in line with the industry standard for institutional shares, said officials at GE Financial Assurance, which owns the $1.8 billion fund family. There is about $603,000 under management in Class D.
Additionally, GE is reducing the distribution fee to 0.25% from 0.5% for Class A shares, which contain about $343,000. The fee change was made because GE also intends to redesignate all Class C shares to Class A. Class C shares currently have a 0.25% distribution fee and have been available to GE employees, retirees or their family members. About $466,000 is in Class C shares, said GE spokesman Tim Benedict. The combined A fund will have more than $800,000.
A new version of Class C shares will be introduced Oct. 1. Those will be available to the general public. Class B shares are unchanged.