Fundsters may not be surprised to hear that bond funds are still hot and equity funds are not. In its "Fund Flows Update" for July, Morningstar reveals that another $12.366 billion net flowed out of U.S. stock funds last month, along with $565 million out of international stock funds and $1.754 billion out of balanced funds, even as fixed income and money market mutual funds continued to rake in the dough: $22.315 billion net flowed into taxable bond funds, $3.904 billion into muni bond funds, and $4.928 billion into money market.

"Almost universally, outflows picked up in equity and balanced funds; and inflows rose for bond, alternative, and commodity funds," Morningstar editorial director Kevin McDevitt writes in the report. "These trends suggest that risk aversion continues to the dominant sentiment."

The report also contains an in-depth look at emerging market fund flows, at flows for the top fund families and at trends on the ETF side of the business. 

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