Investors are piling into active fixed income funds at record levels, according to State Street Global Advisors. The funds saw inflows of $5.48 billion in October, their best month ever, according to Matthew Bartolini, head of the firm’s SPDR Americas Research. That brings inflows to $24.8 billion so far this year for active fixed income funds. “The active fixed income flows in October were mainly driven by ultra-short duration strategies that seek to deliver income and stability, synonymous with the trends we saw in bond sector flows … where short duration government bonds (yielding over 5%) were sought,” Bartolini wrote in a note last week. In fact, 43% of the month’s inflows went into ultra-short bond funds, according to State Street. The funds, which hold securities that mature in less than one year, can help protect against interest rate risk. About 25% went into intermediate core plus bond funds, State Street said. Yields have been moving higher since the Federal Reserve began hiking interest rates early in 2022. In October, the 10-year Treasury yield crossed 5% for the first time since 2007, and is now hovering around 4.6%. Short-term T-bills are all bringing in more than 5%. With that in mind, CNBC Pro screened for active bond exchange-traded funds with the largest inflows in October. Here are the active bond funds with the largest inflows year to date. — CNBC’s Jesse Pound and Michael Bloom contributed reporting.
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