Monster Month For ETF Inflows: $48B

ETF demand in July was as hot as the summer heatwave that hovered over much of the country last month, with more than $48 billion in new assets flowing into U.S.-listed ETFs.

The monster month of inflows has lifted the year-to-date tally to $252 billion, well ahead of last year’s $153 billion at this time. The yearly record of $452 billion of new assets was set in 2017, and by the end of July 2017, $274 billion had been registered. So this year could potentially top that if strong months of flows persist like July just saw. Total assets in U.S.-listed ETFs stand at $4.6 trillion.

Last month was a rare occurrence, in that equity ETFs, which usually lead the inflows chart, was fourth in asset classes, with $3.9 billion. U.S. fixed income led all asset classes, attracting $25.4 billion, followed by commodities at $7.8 billion and international equity with $7.3 billion.

Golden Glow

The physically backed SPDR Gold Trust (GLD) led July inflows, with $3.7 billion, bringing its year-to-date total to $19.2 billion. Its competitor, the iShares Gold Trust (IAU), held down the sixth spot, with $2.2 billion, as investors rode a gold rally that saw spot gold prices set a new record of nearly $2,000/oz.

A declining dollar in the face of Treasury yields seemingly destined only to fall with Federal Reserve committed to rate increase in the immediate future has sent investors to the usual safe havens of gold and bonds. 

The iShares Core U.S. Aggregate Bond ETF (AGG) attracted the second highest assets in July, with $3.47 billion added to it. The fund now stands at nearly $80 billion AUM. The Vanguard Total Bond Market ETF (BND) saw $2.1 billion in inflows. Tried and true vanilla bond funds were not the only benefactors of the flight to safety. The high yield funds iShares iBoxx USD High Yield Corporate Bond ETF (HYG) and SPDR Bloomberg Barclays High Yield Bond ETF (JNK) took in $2.77 billion and $2.15 billion, respectively.

The only equity ETF on the top of the inflows chart was the Vanguard Total Stock Market ETF (VTI), with $1.8 billion.

Some Bond ETFs, Not So Much

Not all bond ETFs saw investor demand. Treasury bond ETFs, and short-term bond ETFs in particular, which are more susceptible to falling yields, populated the redemption list. The SPDR Bloomberg Barclays 1-3 Month T-bill ETF (BIL) saw $1.5 billion in outflows, and the iShares Short Treasury Bond ETF (SHV) lost $1.4 billion in assets.

Other Treasury bond ETFs also bled assets. The iShares 7-10 year Treasury Bond ETF (IEF) topped the outflows chart, seeing $1.73 billion, and the iShares 1-3 Year Treasury Bond ETF (SHY) tallied $787.6 million in redemptions.

The two world’s largest ETFs, both equities, also saw outflows, as investors grew cautious about stocks that continue to post new all-time highs. The SPDR S&P 500 ETF Trust (SPY), with $287 billion in AUM, saw $872 million in outflows, and the Vanguard S&P 500 ETF (VOO), which has $153 billion in AUM, lost $1.39 billion in assets.

Year to date, U.S. fixed income has pulled away from U.S. equity in total new assets, with $117.6 billion versus $75.5 billion. While last year was the first year U.S. fixed income took in more in new assets than U.S. equity, it was a neck-and-neck horse race all year. This year, if the trend holds, should be an easy victory for U.S. fixed income.

For a full list of this month's top inflows and outflows, see the tables below:

Top Gainers (July 2020)

Top Gainers (Year-to-Date)

Biggest Losers (July 2020)

Biggest Losers (Year-to-Date)

Asset Classes (July 2020)

Asset Classes (Year-to-Date)

July 2020 ETF Issuer League Table

Disclaimer: All data as of 6 a.m. Eastern time the date the article is published. Data is believed to be accurate; however, transient market data is often subject to subsequent revision and correction by the exchanges.