Two articles crossed my desk within a day of one another this past week, and together they speak volumes about the state of the mutual fund industry today.
The first, entitled “Fidelity Funds Bled $49.3 Billion Last Year,” highlighted the continuation of a trend I wrote about last year — Fidelity’s negative cash flow. Hard as it may be to believe, Fidelity’s actively managed equity funds haven’t taken in more investor assets than they’ve lost since 2004 — a staggering six year streak for the best-known firm in an industry that has traditionally seen very strong cash flow.
The second article, carrying the headline “Equities Rally Excludes American Funds,” described how February marked the 20th consecutive month that American Funds has seen negative cash flow, which is itself an amazing dry spell for a firm with legions of brokers pushing their funds.
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