Investors seemed to lose some of their faith in mutual funds largely made up of mortgage securities from the Government National Mortgage Association, as the overall flow of cash into the funds dropped in August, the latest month available.

According to the Investment Company Institute, Ginnie Mae mortgage funds gained a total of only $683.7 million in net new sales for August, down from a gain of $907.1 million in July but up from $413.6 million in August 1998.

Total assets for August were $60.2 billion, up from $59.6 billion in July and $59.3 billion a year earlier.

Other Ginnie Mae mutual fund data released for August included the following:

* Total sales, including reinvested dividends, were $1.686 billion, down from $1.853 billion in July and up from $1.19 billion in August 1998.

* Total sales, less reinvested dividends, were $1.474 billion, down from $1.648 billion in July and up from $1.014 million in August 1998.

* Redemptions were $1.003 billion, up from $946 million in July and up from $773 million a year earlier.

* Exchanges into the funds were $467.2 million, down from $537.2 million in July and $855 million in August 1998.

* Exchanges out of the funds were $622 million, up from $516.3 million in July and $462.6 million a year earlier.

* Liquid assets were minus-$5.37 billion, down from minus-$4.8 billion in July and minus-$2.6 billion in August 1998.

* Liquidity ratios were minus-8.9%, down from minus-8.1% in July and minus-4.5% a year earlier.

Subscribe Now

Access to a full range of industry content, analysis and expert commentary.

30-Day Free Trial

No credit card required. Access coverage of the securitization marketplace, including breaking news updated throughout the day.