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Lipper
Muriel Siebert & Co.


Across My Desk



There's a rival brewing between the nation's largest fund families and it's all about attracting your money.

According to MMExecutive, an on-line mutual fund industry e-mail newsletter, investors withdrew large amounts of money from both Putnam and Fidelity in September. Continued moves like that don't bode well for the families or those who stay invested.

Here's more from that early November piece:

  • Net outflows from the Putnam family of funds in September topped $1.8 billion making that fund family's year-to-date outflows $15 billion, according to Financial News. Putnam is now the ninth-largest mutual fund firm in the U.S.

  • The fund family with the second largest withdrawals in September was Fidelity---$881 million left that family.

  • Vanguard, on the other hand, has seen the buckos roll in: Through September $34 billion in new money has come into that happy family.

  • The Capital Group is another fund family racking in the dough---$61 billion of it so far (through September).

Money flows --- whether they are coming or going --- are important to existing fund shareholders as too much money flowing in can create as many challenges for fund managers as too much flowing out: When a lot of money comes in, appropriate investments have to be made no matter what market conditions prevail, and, too much flowing out mean portfolio holdings may have to be sold no matter what market conditions prevail.

Bottom line: The Capital Group, Vanguard and Fidelity are all vying for your investment dollars and to gain them are fiddling with fees. But don't let lower fees be the only reason you invest with a fund family --- good portfolio fund management, funds that meet your investment needs and proper asset allocation and diversification are all equally important.


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