US high-yield funds post $1.4 billion outflow; 4-week average stays positive

U.S. high-yield funds posted outflows of $1.4 billion for the week to July 14, marking the first net redemptions in four weeks, according to Lipper. The four-week average held narrowly positive, at an inflow of $104 million.

The latest outflow reflected a $1.57 billion redemption of U.S. high-yield exchange-traded funds, partially offset by a $170 million inflow to mutual funds. For the year to date, outflows total $13.3 billion from mutual funds and $3.1 billion from ETFs.

The overall $16.4 billion of outflows from high-yield funds so far this year compares with an inflow of $38.3 billion for all of 2020. Notably, the outflows persist even as the assets comprised by the funds have seen a positive $11.7 billion net change this year due to market conditions. The change over the latest week was negative at $486 million, as underlying rates oscillated in the face of competing pressures from inflation concerns and a still-accommodative Fed.

For reference, the price for the S&P U.S. High Yield Corporate Bond Index was 106.08% of par as of July 14, firm to a 105.80 price on Jan. 1, 2021, and up more than 2 percentage points from the 2021 low at 104.01, on March 19.

Assets at the weekly reporters to Lipper dipped to $272.7 billion as of July 14 ($76.6 billion of which is at ETFs), from $274.4 billion a week earlier.