Bond investors did this for only the 2nd time in 6 months

Investors still aren't showing much love for stocks, at least according to flows in mutual funds and ETFs. They still favor bonds, despite a recent blip.

The latest data from Lipper shows that investors finally pulled some money out of bond funds over the past week. That's only the 2nd outflow in the past 30 weeks.

Mutual fund and ETF flows into bonds

Stocks, on the other hand, have seen almost nothing but outflows over that time span. The consistency of flows between the two asset classes has never been more stark. 

The difference in flows moved to a record several weeks ago and continues to reach new highs. The handful of other times there were around 15 more weeks of inflows to bonds versus stocks, the bond/stock ratio tended to decline.

What else is happening

These are topics we explored in our most recent research. For immediate access with no obligation, sign up for a 30-day free trial now.

  • A look at flows into stock mutual funds and ETFs
  • What happens to the bond/stock ratio when there are consistent flows into bonds and out of stocks
  • There has been a record number of Up Volume breadth thrusts in 2020
  • On a shorter time frame, we're seeing a cluster of breadth thrusts similar to October

Stat Box

Last wee, the S&P 500 rallied more than 7% and closed at an all-time weekly closing high. That's its best-ever weekly gain to set a new high. There have been 6 other times it rallied 5% or more to set a new record, typically leading to a little more short-term strength. Over the next 3 months, 2 of the signals showed more gains, while 4 suffered losses as buyers became exhausted.

Sentiment from other perspectives

We don't necessarily agree with everything posted here - some of our work might directly contradict it - but it's often worth knowing what others are watching.

1. If the VIX keeps falling, then it suggests investors will give stocks higher multiples - Robeco

2. Newsletter writers are pretty optimistic that stocks will keep rallying - Yardeni

3. When traders push small tech stocks far above their usual daily gain, forward returns were weak - Traders' Insight

The post titled Bond investors did this for only the 2nd time in 6 months was originally published as on on 2020-11-09.

At, our service is not focused on market timing per se, but rather risk management. That may be a distinction without a difference, but it's how we approach the markets. We study signs that suggest it is time to raise or lower market exposure as a function of risk relative to probable reward. It is all about risk-adjusted expectations given existing evidence. Learn more about our service , research, models and indicators.

Follow us on Twitter for up to the minute analysis of market action.

Not ready to signup up for a free trial yet?

Signup for our Daily Lite email to receive highlights of our daily report, research and studies.

Follow us on Twitter:

Subscribe to our Youtube Channel:

RSS Feed

Subscribe to the Blog RSS feed