In the black.
American Funds and T. Rowe Price are the only active companies with positive asset flows so far this year, according to a new Morningstar report. American Funds, the second largest fund family by assets under management, took in nearly $7.6 billion year-to-date through May, while T. Rowe Price, the fifth largest firm, drew $1.9 billion in positive flows. Meanwhile, Franklin Templeton Investments has had $17 billion in outflows so far this year, while Fidelity and Pimco each saw redemptions of about $6.4 billion over the same time period. Much of American Funds' recent flows may have come from its American Balanced Fund (ABALX), which had the fifth-highest positive flows among active funds in May, taking in $949 million during the month.
There is room for growth for U.S. equities, according to three Wells Fargo market strategists. In a video posted on the bank's AdvantageVoice blog, John Manley, chief equity strategist; Jim Kochan, chief fixed income strategist; and Brian Jacobsen, chief portfolio strategist, all agreed that leading economic indicators suggest that the likelihood of a recession in the next six to 12 months is very low. "Usually people get excited about a market, a bull market, before it ends," Manley said. "That hasn't happened yet. That leads me to think that's still in front of us, and with that still in front of us, that's opportunity." Kochan agreed that the positive outlook in the economy has helped the high-yield market rally as well. And Jacobson added that mid-caps are more attractive at this point, even though valuations are reasonable across the board. "I still see good valuation in the U.S., not great; overseas, still phenomenal," Manley said.
Cheaper than competitors.
Scottrade Inc. wants to be the go-to source for active traders to trade options. The digital brokerage announced Wednesday it is lowering option contract fees from $1.25 per contract to 70 cents. The company said the change could save traders hundreds of dollars in a year and makes option trading on Scottrade less expensive than at TD Ameritrade, Schwab, Fidelity and E*Trade. In addition to reducing fees, Scottrade is giving active traders access to a dedicated team of specialists to help them implement options trade strategies.