Stock Funds and ETFs Log Highest Monthly Inflow Since 1996

Equity mutual funds and ETFs pulled in $34.2 billion of net inflows in January, the highest monthly total since 1996, according to a report.

“It’s a good sign,” said Lipper analyst Matthew Lemieux in a Reuters article. “It reinforces the thought that investors in general have a better sentiment on the market and the economy.”

During the first 17 trading days of January alone, investors added $25.2 billion into U.S.-listed ETFs with 92% of the total heading to stocks.

“With ETF flows so solidly ‘Risk on,’ at least we know the market’s huge move from the March 2009 lows is, finally, getting some attention,” Nicholas Colas, ConvergEx chief market strategist, said in a recent note. “January is proving to be a barnburner month for demand in ETFs which focus on equity investments.” [January Stock ETF Flows]

Investors are moving into equity mutual funds and ETFs as the S&P 500 tries to clear the key 1,500 level with the 2007 all-time high within reach.

For the week ended Jan. 30, stock ETFs attracted $6.9 billion, the most since the first full week of the year, when they pulled in $10.8 billion, according to Reuters. “ETFs that hold U.S. stocks, meanwhile, attracted $5.65 billion in new cash, the most in seven weeks and far exceeding the $1.29 billion inflow into ETFs that hold foreign stocks,” it reported.

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