Morningstar: Passive equity and active bonds dominate

Morningstar’s most recent U.S. Asset Flows Update is once again dominated by two stories: the continued trend towards passively managed equity funds, and fluctuations in the active taxable bond group. As 2014 draws to a close, the U.S. equity group continues to see inflows to the passively managed side, while the actively managed side sees outflows. Morningstar reports that over a trailing one year period passive equity funds have increased by $156.1 billion, while active equities have shrunk $91.9 billion.

During November, the active taxable bond group saw its first positive flow since August. Bill Gross’ exit from PIMCO in September set the category on its ear, but confidence appears to be returning as investors begin to explore other taxable-bond options.

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