The Investment Company Institute released its latest monthly "Trends in Mutual Fund Investing" and "Month-End Portfolio Holdings of Taxable Money Funds" for December 2022 Monday. ICI's monthly "Trends" report shows that money fund assets increased $105.3 billion in December to $4.777 trillion. Meanwhile, bond fund assets decreased by $73.4 billion to $4.492 trillion. Money fund assets, which surpassed bond fund assets in September 2022 for the first time since 2010, remain larger than bond funds and are seeing their lead grow. MMFs have increased by $21.0 billion over the past 12 months. (The bond fund totals don't include bond ETFs, which total $1.261 trillion as of 12/31, according to ICI.)
Money funds' December asset increase follows a gain of $63.4 billion in November, $36.8 billion in October and $4.2 billion in Sept. MMFs decreased $6.4 billion in August, but they increased $34.3 billion in July and $25.0 billion in June. MMFs decreased $8.0 billion in May and $71.0 billion in April. They increased $9.6 billion in March, decreased $38.3 billion in February, and decreased $136.1 billion in January. For the 12 months through Dec. 31, 2022, money fund assets increased by $21.0 billion, or 0.4%. (For the month of January through 1/27, MMF assets have increased by $5.6 billion to $5.195 trillion according to Crane's MFI XLS, which tracks a broader universe of funds than ICI. Crane Data's Prime asset totals have increased by $24.5 billion in January to $1.100 trillion.)
ICI's monthly release states, "The combined assets of the nation's mutual funds decreased by $722.31 billion, or 3.2 percent, to $22.11 trillion in December, according to the Investment Company Institute's official survey of the mutual fund industry. In the survey, mutual fund companies report actual assets, sales, and redemptions to ICI.... Bond funds had an outflow of $53.16 billion in December, compared with an outflow of $34.52 billion in November.... Money market funds had an inflow of $96.43 billion in December, compared with an inflow of $56.33 billion in November. In December funds offered primarily to institutions had an inflow of $20.71 billion and funds offered primarily to individuals had an inflow of $75.72 billion."
The Institute's latest statistics show that Taxable funds were higher and Tax Exempt MMFs were also higher last month. Taxable MMFs increased by $101.3 billion in December to $4.664 trillion. Tax-Exempt MMFs increased $4.0 billion to $112.4 billion. Taxable MMF assets decreased year-over-year by $4.6 billion (-0.0%), and Tax-Exempt funds rose by $25.6 billion over the past year (29.5%). Bond fund assets dropped by $73.4 billion (after jumping by $120.3 billion in Nov.) to $4.492 trillion; they've decreased by $1.133 trillion (-20.1%) over the past year.
Money funds represent 21.6% of all mutual fund assets (up 1.1% from the previous month), while bond funds account for 20.3%, according to ICI. The total number of money market funds was 291, down one from the prior month and down from 305 a year ago. Taxable money funds numbered 236 funds, and tax-exempt money funds numbered 55 funds.
ICI's "Month-End Portfolio Holdings" confirm yet another jump in Repo and plunge in Treasuries last month. Repurchase Agreements remained the largest composition segment in December, increasing $272.5 billion, or 10.9%, to $2.761 trillion, or 59.2% of holdings. Repo holdings have increased $433.5 billion, or 18.6%, over the past year. (See our Jan. 12 News, "Jan. MF Portfolio Holdings: Fed RRP, Repo Surges to Record; T-Bills Drop.")
Treasury holdings in Taxable money funds fell again, but they remained the second largest composition segment. Treasury holdings plunged $95.7 billion, or -8.6%, to $1.017 trillion, or 21.8% of holdings. Treasury securities have decreased by $676.9 billion, or -40.0%, over the past 12 months. U.S. Government Agency securities were the third largest segment; they decreased $11.3 billion, or -2.2%, to $507.4 billion, or 10.9% of holdings. Agency holdings have increased by $128.5 billion, or 33.9%, over the past 12 months.
Certificates of Deposit (CDs) remained in fourth place; they decreased by $48.2 billion, or -22.1%, to $170.0 billion (3.6% of assets). CDs held by money funds rose by $53.6 billion, or 46.0%, over 12 months. Commercial Paper remained in fifth place, down $8.4 billion, or -4.7%, to $168.4 billion (3.6% of assets). CP increased $31.7 billion, or 23.2%, over one year. Other holdings decreased to $15.4 billion (0.3% of assets), while Notes (including Corporate and Bank) inched down to $4.3 billion (0.1% of assets).
The Number of Accounts Outstanding in ICI's series for taxable money funds decreased to 59.324 million, while the Number of Funds fell by one fund to 236. Over the past 12 months, the number of accounts rose by 11.358 million and the number of funds decreased by 9. The Average Maturity of Portfolios was a record low 14 days, down 1 from November. Over the past 12 months, WAMs of Taxable money have decreased by 22.
