Investors turn to money market funds
Investors continued to move their wealth into money market funds in June to avoid market volatility, the Investment Funds Institute of Canada (IFIC) said Tuesday.
The group's monthly report on mutual funds contains a number of statistics showing the popularity of money market funds, investments in short-term loans often seen as a safe harbour or a place to "park" money when markets are uncertain.
According to IFIC, in June:
Money market funds ballooned to $70.1 billion from $48.7 billion in June 2007.Net sales (sales less redemptions) of all funds were $1.6 billion; money market funds accounted for three-quarters of the total.Investors have put $19.3 billion into money market funds in the past year, compared with $4.2 billion in the previous year.While money market investments rose, the sales and values of long-term funds fell.
Assets of such funds were $630.1 billion in June, down from $650.7 billion in May, reflecting the fall in stock markets.
Long-term fund sales were $398 million in June, down from $752 million in May and almost $2 billion in June 2007.
Sales in the year ended June were $3.8 billion, compared with $30.9 billion in the year ended June 2007.
Total assets in funds were $700.1 billion in June, down from $719.3 billion in May. The drop was due to market falls, the IFIC said.
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