Feb

07

2008

Vanguard Mutual Funds Tops in 07

According to Reuters, Vanguard Mutual Funds pulled in the most money to its stock and bonds mutual funds in 2007, eclipsing American Funds which held the top spot since 2002.  Vanguard saw net inflows of 76.2 billion last year compared to 42.7 billion in 2006 as investors poured money into its safer money market accounts and ETF’s.  According to the Financial Times, ETF’s provided a major boost with assets growing from 23 to 42 billion last year.  It expects to add more ETF’s this year after adding 10 new ones last year and is seeking regulatory for actively traded ETF’s (a subject for another post). 

The biggest percentage increase of inflows were to State Street Global Advisors, a unit of State Street Corp (STT) with a huge jump to 49.2 billion in assets from just 3.4 billion the year before mostly due to the popularity of its growing list of ETF offerings.  Wow!  No wonder STT is trading near all time highs. 

I personally would like to see companies close out more and more of their most unpopular ETF offerings and come up with more unique offerings in niche segments such as Platinum or Solar (I know PBW comes close).. I would guess we’ll see these ETF’s soon.  How many big cap, or mid cap or global diversified funds do we need!  It’s getting ridiculous and this industry is due for a shakeout.