Fund Flows Data Shows a Skittish Public

Published May 24th, 2006 in Sentiment Tags: AMG Data, fund flows, liquidity, mutual funds, sentiment.

According to AMG, mutual fund and ETF investors have been spooked by last week’s market drop and pulled out major coin. “Including ETF activity, Equity funds report net cash outflows totaling -$3.860 billion in the week ended 5/17/06…”

But more interesting is that several sectors have borne the brunt of the selling:

“Excluding ETFs, Energy funds report the largest net outflows since 2/15/06″ (this was when the energy sector put in its first intermediate bottom - which was tested and held in early March 2006)

“Excluding ETFs, more Healthcare/Biotech funds report net outflows than any week since 8/11/04…” (this was when the healthcare and biotech sectors put in a major V bottom in August 2004)

“Excluding ETFs, Technology funds report the largest net outflows since 2/15/06 and more funds reporting net outflows since 4/20/05″ (this was the major spring bottom in tech and almost all major indices and sectors)

If you’ve read my recent commentaries, you know that I’m bullish on both the energy and healthcare/biotech sectors, so its good to see the fund flow information confirming that. I hadn’t really given the tech sector much thought but since its fund flows are so negative it might merit a closer look.