2007 Findings
- Traditional asset categories experienced significant tax-exempt outflows in 2007 of more than $265 billion. Large cap U.S. and international equities accounted for 80% of the outflows. Continued demand for alternative strategies was a key driver of traditional asset declines. Rebalancing and movement toward liability-driven investing also contributed to outflows.
- Across groups measured by STAR, few areas had net gains – active extension, core plus fixed income, and global equity were the only groups with net increases for the year. Active extension strategies, new to STAR in 2007, pulled in over $9 billion for the year. While generally considered part of the equity allocation, some investors are drawn to active extension strategies as an alternative to hedge fund investing.
- Mutual funds had outflows of $11 billion for the year. Similar to institutional flows, outflows were greatest among domestic large cap equities. In contrast to institutional flows, Lipper’s™ broad fixed income group increased assets by $26 billion and international equity funds grew by nearly $50 billion net.
Snapshot of Findings
