Thursday, May 26, 2011

Bethel Finances: Public flees stock and bond funds

www.bethelfinance.com

Bethel Finance news:

The mutual funds industry has sustained heavy withdrawals in the past few days. Since the beginning of the week, in just three trading sessions, about NIS 1 billion has been redeemed from the traditional mutual funds. The peak was reached yesterday, with redemptions amounting to about NIS 500 million, according to data from Meitav Investment House Ltd. advisors relations manager Roni Apter.

Most of the redemptions are from company and general bonds funds, which, in the past two and a half years, have been the funds that have attracted the most money. Because of the falls in share and bond prices, particularly company bonds, these funds have sustained high levels of redemptions, amounting to some NIS 730 million, half of it yesterday.

In these past three days, the company and general bond funds have fallen by an average of 1.1%. In the case of some funds, this negative yield made the falls in their prices steeper; with others, it put them in negative territory for the first time this year.

According to Meitav, redemptions from funds investing in stocks have amounted to some NIS 180 million in the same period.

Two categories that have managed to mop up some of the money flowing out of the stocks and bond funds are money market funds (NIS 460 million) and shekel funds (NIS 60 million), particularly pure makam (treasury bills) funds.

Since the beginning of the month, over NIS 2.1 billion have been withdrawn from mutual funds. If this rate continues, withdrawals will be the highest since the worst of the global economic crisis in November 2008.

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