* Weekly flows reveal “fear”: big $19.8bn inflows to Money Market funds, $10.6bn inflows to Bonds, $8.6bn redemptions from Equity funds…so risk assets rallied
* Capitulation: massive redemptions from Industrials (-9.3% of AUM), Floating Rate funds (-1.2% of AUM), Healthcare (-2.2% of AUM, -$1.6bn = record), SPY ETF (-5.0% of AUM) as investors give up on global growth, rate hikes + forced selling of winners
* Weekly winners: US Treasuries (1.4% of AUM), Japan (1.5% of AUM), Brazil (4.2% of AUM)
* “Meltdown leaders” catch a bid: inflows to Energy ($0.6bn), small Small Cap outflow ($0.4bn), 1st inflows to High Yield in 8 weeks ($1.6bn)
* YTD flows: $71bn into stocks, $176bn into bonds, -$26bn out of money market funds
* Private client: YTD flows of BofA-ML private client shows shift from bonds/cash to stocks, a shift undisturbed by recent volatility (Chart 1)
* Death of Inflation trade: flows into Gold & TIPS collapsed past 18 months…now Floating Rate outflows
>>> Asset Class Flows
* Equities: $8.6bn outflows (4 straight weeks)
* Bonds: $10.5bn inflows (5 straight weeks)
* Precious metals: $0.4bn outflows
>>> Fixed Income Flows
* 44 straight weeks of inflows to IG bond funds ($5.5bn)
* Large $4.9bn inflows to govt/tsy funds (largest in 37 weeks) (Chart 3)
* First inflows in 8 weeks from HY bond funds ($1.6bn)
15 straight weeks of outflows from floating-rate debt ($1.4bn)
>>> Equity Flows
* Europe: $2.2bn outflows (8 straight weeks)
* EM: $1.0bn outflows (3 straight weeks) (Table 2)
* US: $7.8bn outflows (mostly via ETF’s)
* Japan: $3.2bn inflows (largest in 27 weeks)
By sector, healthcare funds see largest outflow on record; inflows from real
estate and energy ($2.1bn combined)