US Investors May Fear They've Missed the Boat on this Recent Market Rally

-US equity funds shed $8.2 billion in the week ending July 20

-US bond funds captured almost double that amount

In Reuters’ review of weekly ICI fund flow data, the author noted both the recent and longer-term trend of outflows from domestic stock funds. With the market continuing to hit new highs, it begs the question if investors believe they’ve missed out on the stock market rally and it’s simply too late to enter the market. For 2016 so far, the ICI data showed inflows of $126 billion into bond funds, whilst US stock mutual funds and ETFs have shed $61 billion.

The risk-on/risk-off debate continues and the focus is how much higher can this market go, but predicting the market’s direction is a gamble.

For fund families that either primarily or exclusively offer US equity fund strategies, the key is educating investors. Timing the market works consistently for few.  Dollar cost averaging and portfolio and risk analysis at least annually are important tasks. Consider a blog post or short communication piece on the importance of staying invested, analyzing portfolio risk and rebalancing. By continuing to communicate with your investors, you can help to alleviate any nerves and remind them of your process and how it adapts to navigate environmental challenges.

SunStar Strategic has helped many clients create and maintain regular communications and public relations programs to do just that—contact us to see how we can help you do the same. 

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