Yesterday we discussed the way U.S. equity mutual funds surged in the fourth quarter of 2011, rising more than 10 percent. But that wasn't enough to bring investors back into the fold. Apparently spooked by the wave of losses we endured in the third quarter, investors pulled nearly $66 billion out of domestic stock funds in the fourth quarter last year.
That wasn't the only category to lose assets on the quarter. International stock funds, which gained a less-robust 4.3 percent for the fourth quarter on the way to an overall loss of 13.4 percent on the year, saw an outflow of $15.6 billion over the same time period.
Where was all that money going? Bond funds. Fixed-income funds took in $52.5 billion in new cash over the final three months of 2011. That breaks down as $41.2 billion into taxable-bond funds, and $11.3 billion into municipal-bond funds.
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