The holiday doldrums didn’t keep investors from putting money into municipal bond mutual funds.
They did so for a third straight week with apparent enthusiasm.
In the week ending Dec. 21, muni bond funds saw roughly $764 million of inflows from funds that report their flows weekly, according to Lipper FMI. In the week ending Dec. 14, there were net inflows of almost $460 million.
Munis posted another firm week, albeit modest in proportion. Investor activity was understandably limited by the holiday season. Yet bonds were still a tad more expensive on the week, as market participants cited strong technicals and a favorable environment in January for yield.
But those same participants remember the months when money fled muni funds in torrents between mid-November 2010 and early June, often by more than $1 billion a week. In the week of Jan. 19, investors in weekly reporting funds withdrew more than $4 billion.
Assets for funds that report their flows weekly fell slightly to $268.9 billion from $269.4 billion the previous week. Around six weeks ago, a large asset manager that had been supplying weekly numbers stopped, Lipper reported. That is said to account for much of the recent pronounced plunge in fund assets.
The value of the holdings for weekly reporting funds rose by $539 million. The week before, they increased by $506 million.
The four-week moving average for all municipal bond mutual funds that report their flows weekly saw a $491 million inflow, up from the $334 million gain the week before.
High-yield muni funds saw a third straight week of inflows this past week after two straight weeks of outflows.
Funds that report weekly saw inflows of $72.4 million, Lipper said. The previous week, high-yield funds reported inflows of $90.5 million.
Assets for high-yield funds that report their flows weekly rose for a third straight week after three weeks of decreases. They ended at $33.86 billion, up from $33.70 billion the previous week.
The value of the holdings for weekly reporting funds rose by $90.7 million. Last week, they increased by $59.1 million.
The four-week moving average for all high-yield muni bond funds that report their flows weekly was a $21.7 million inflow, up from a $24.1 million outflow the week before.
