High Yield mutual funds have had net outflows of approximately $6.5 billion during this summer bringing their year to date net negative flows to almost $11 billion. This investor sentiment carries over from 2013 during which the group also had overall net outflows of $6.5 billion. These results come on the heels of a four-year run that saw high yield mutual funds average net inflows of $16.7 billion per year.
The group had a four-week run that culminated with the week of August 6 that saw it incur most of its net outflows. Negative flows totaled over $8.8 billion during this time period with the week of August 6 accounting for $5.8 billion of that total. Taking a closer look at the week indicates the selling was broad based throughout the high yield mutual fund universe as half of the top twenty weekly net outflows came from high yield funds. Pacing the high yield group was the Northern Funds High Yield Fixed Income Fund (NHFIX) and the BlackRock High Yield Bond Portfolio (BHYIX) which had net outflows of $540 and $418 million, respectively.