A small group of technology stocks may be powering the stock market higher, but investors have continued fleeing equity funds in the first five months of 2023 in favor of fixed-income alternatives, according to LSEG Lipper data.
An estimated $114.3 billion was pulled from conventional equity funds this year through the end of May, according to the data, as investors brace for the Federal Reserve’s higher rates to course through the U.S. economy. Funds instead have been pouring into taxable fixed-income funds that accumulated $63 billion so far this year, as investors have embraced some of the highest yields for bonds in about two decades.
Still, the fund flows away from stocks hasn’t stopped the Nasdaq Composite Index COMP from advancing 26.4% on the year through Monday.