ETF Investors Shrug Off Monday's Drop, Put Money to Work

ETF investors were unfazed by yesterday's gut-wrenching sell-off in the stock market. On Monday, the S&P 500 tumbled as much as 4.3%, but U.S.-listed ETFs picked up $3.9 billion of new cash, according to the latest data from Bloomberg.

Net inflows for equity ETFs were a bit larger—$4.3 billion—which was offset by outflows of around half a billion dollars for fixed income ETFs.

The numbers suggest that ETF investors as a whole weren’t panicking despite the gloomy headlines and volatile moves in markets on Monday. 

SPY, QQQ Generate Net Inflows

Investors didn’t make things too complicated. They put money to work in some of the largest, most liquid ETFs, like the SPDR S&P 500 ETF Trust (SPY) and the Invesco QQQ Trust (QQQ), which had daily inflows of $3.7 billion and $1.8 billion, respectively. 

Some investors sought the safety of Treasury bills: the SPDR Bloomberg 1-3 Month T-Bill ETF (BIL) had inflows of $448 million, the fifth-largest of the day.

While other investors seemed to be on the lookout for bargains in the tech sector. The Direxion Daily Semiconductor Bull 3x Shares (SOXL) and the Technology Select Sector SPDR Fund (XLK) had inflows of $379 million and $277 million, respectively. 

On the flip side, ETF investors seemed to have backed away from the small cap trade. 

The iShares Russell 2000 ETF (IWM), a popular fund with investors who were betting on better performance for small stocks relative to large stocks, had the largest outflows of the day—$1.2 billion. 

Another notable flows laggard was the iShares 20+ Year Treasury Bond ETF (TLT), which registered outflows of $395 million, as investors took profits following a surge in the ETF’s price.