Bond mutual funds listed in the U.S. and exchange-traded funds lost an all-time record of $61.7 billion in June, TrimTabs Investment Research said.
This outflow far exceeds the previous record monthly outflow of $41.8 billion at the height of the financial crisis in Oct. 2008.
"The unprecedented liquidation of bonds this month is a dramatic departure from recent trends," said David Santschi, chief executive officer of TrimTabs. "Before June, bond funds had posted inflows for 21 consecutive months."
The selling is due to a combination of steadily rising yields and hints from global central bankers that monetary stimulus may be scaled back in the future.
"Until this month, investors were piling into all sorts of exotic credit instruments with little regard for value, confident that endless central bank liquidity would inflate prices," Santschi said.
He added, "The massive selling at the mere suggestion that this liquidity might diminish shows the degree to which central bank intervention is driving the markets."