Recent highs in the domestic markets have affected exchange traded funds (ETFs) as new money flows into U.S. stock funds.  From May through October of this year, there was an outflow of about $25 billion from U.S. stock funds, reports Murray Coleman for MarketWatch.  The record setting pace of the Dow Jones has more investors putting more money to work. 

Since the end of 2004, more than 75% of all new money was going offshore.  It is too early to determine if this shift to domestic stocks is going to stay, but lower energy prices, soft inflation data and optimism over the recent elections, give some indications that it might continue longer. 

Flows aren’t decreasing in other fund classes either, and new money is pouring into international stock funds, likewise.  ETFs are benefiting from this as well, as ETF assets continue to rise.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

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