Flow of New Funds Slows to a Drip

The fund business is getting tougher, and that's good news for you.

Amid shriveled returns and sales, the pace of new mutual fund launches last year fell to its lowest level in more than 20 years. The number of mutual funds rose by just 165, according to the latest figures from the Investment Company Institute, the fund industry's largest trade group. The modest uptick underscores the glut of funds out there, the maturing industry's consolidation and flagging interest in funds after two tough years for stock investors.

This trend shouldn't rattle fund investors, however. As we said in a November column, Main Street investors will only benefit from heightened competition for their money. Of course, the news isn't as good for the fund managers who will inevitably find less demand for their services.

Man From Atlantis

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