$24B Stampedes Into US Equity ETFs

ETF investors were crazy over U.S. equities, while shunning other asset classes.

sumit
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Senior ETF Analyst
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Reviewed by: Sumit Roy
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Edited by: Sumit Roy

The post-election stampede into ETFs continued this week as investors remained in an optimistic mood following Donald Trump's victory. In aggregate, $16.2 billion flowed into U.S.-listed exchange-traded funds in the week ending Thursday, Nov. 17, according to FactSet. That comes on top of the $23.9 billion that came into ETFs last week. Year-to-date inflows now total $214.4 billion.

In contrast to last week, when ETFs across the board saw inflows, this week investors were almost exclsuively focused on U.S. stocks. ETFs related to U.S. equities had a whopping $24.1 billion worth of inflows in the period, as most of the major U.S. stock market indexes neared all-time highs. 

The Dow Jones industrial average hit a record 18,934 on Monday, while the S&P 500 rallied as high as 2,190 on Fridayjust a smidgen off its all-time best level of 2,193 from August. Meanwhile, the small-cap Russell 2000 powered to a record high of its own for the first time since June 2015 after rallying for 10-straight sessions through Thursday.

With all the bullish attention on U.S. stocks, investors shunned other types of ETFs. Tumbling bond prices (and surging interest rates)―as well as a spike to 14-year highs in the U.S. dollar―led investors to pull money out of everything from U.S. fixed-income ETFs to international equity ETFs.

In total, international equity ETFs had outflows of $2.1 billion during the week; U.S. fixed-income ETFs had outflows of $3.1 billion; international fixed-income ETFs had outflows of $706 million; and commodity ETFs had outflows of $1.5 billion. 

US Financials, Tech & Small-Caps In Vogue 
With the Russell 2000 hitting an all-time high for the first time in 17 months, it's no surprise that the iShares Russell 2000 ETF (IWM) had the largest inflows of any product, at $3.5 billion.

Following at the No. 2 position was the Financial Select Sector SPDR Fund (XLF), which garnered $2.7 billion worth of inflows on top of last week's $2.6 billion. Though the rally in the sector slowed this week, XLF's share price increased by about 1% week-over-week.

The Industrial Select Sector SPDR Fund (XLI) was another repeat-winner, with inflows of $1.2 billion. Some analysts believe Trump's anticipated infrastructure spending plan will benefit sectors such as industrials and materials. 

Meanwhile, on a percentage basis, the biggest winner on the top 10 inflows list was the First Trust Nasdaq-100 Technology Sector Index Fund (QTEC), with inflows of more than $700 million. Assets in the ETF nearly doubled in the past five trading sessions. After a rough week last week, large-cap tech stocks made a comeback, as investors reasoned that Trump's policies may not be as detrimental to the industry as feared. 

Treasurys, Gold & Emerging Markets Shunned
It's no surprise that on the outflows side, the biggest losers were related to Treasurys, gold and emerging markets. The iShares MSCI Emerging Markets ETF (EEM) was at the top of the losers heap, with outflows of $2.5 billion. The strong dollar and some of Trump's anticipated trade policies have weighed on emerging market equities.

For similar reasons, the iShares JP Morgan USD Emerging Markets Bond ETF (EMB) had outflows of more than $700 million during the week. A strong dollar makes servicing dollar-denominated debt more difficult for overseas borrowers.

Two gold ETFs found themselves on the outflows list. The SPDR Gold Trust (GLD) and the iShares Gold Trust (IAU) had redemptions of $841 million and $643 million, respectively. Gold prices dropped to as low as $1,203 on Friday, the cheapest price since February.

The rest of this week's outflows list was dominated by various bond ETFs. The SPDR Barclays High Yield Bond ETF (JNK) and the iShares iBoxx $ High Yield Corporate Bond ETF (HYG) each had outflows of more than $650 million; the iShares 1-3 Year Treasury Bond ETF (SHY) saw outflows of $609 million; and the iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) saw outflows of $430 million.

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

Top 10 Creations (All ETFs)

TickerNameNet Flows ($,mm)AUM ($, mm)AUM % Change
IWMiShares Russell 2000 ETF3,530.7135,351.8411.10%
XLFFinancial Select Sector SPDR Fund2,727.0419,594.8116.17%
SPYSPDR S&P 500 ETF Trust2,277.41210,943.081.09%
IVViShares Core S&P 500 ETF1,364.7784,780.421.64%
XLIIndustrial Select Sector SPDR Fund1,247.669,560.7715.01%
QQQPowerShares QQQ Trust1,245.2140,152.393.20%
DIASPDR Dow Jones Industrial Average ETF Trust775.0212,762.926.47%
IJRiShares Core S&P Small Cap ETF751.2523,649.863.28%
QTECFirst Trust NASDAQ-100 Technology Sector Index Fund701.361,425.6896.83%
VTIVanguard Total Stock Market Index Fund675.4666,584.091.02%

Top 10 Redemptions (All ETFs)

TickerNameNet Flows ($,mm)AUM ($, mm)AUM % Change
EEMiShares MSCI Emerging Markets ETF-2,523.3125,866.41-8.89%
GLDSPDR Gold Trust-841.3536,376.40-2.26%
EMBiShares JP Morgan USD Emerging Markets Bond ETF-704.038,561.45-7.60%
JNKSPDR Barclays High Yield Bond ETF-676.9810,896.58-5.85%
HYGiShares iBoxx $ High Yield Corporate Bond ETF-659.4615,965.90-3.97%
IAUiShares Gold Trust-642.838,256.03-7.22%
FXDFirst Trust Consumer Discretionary AlphaDEX Fund-636.67698.00-47.70%
SHYiShares 1-3 Year Treasury Bond ETF-609.3310,829.88-5.33%
EFAViShares MSCI EAFE Minimum Volatility ETF-513.336,942.59-6.88%
LQDiShares iBoxx $ Investment Grade Corporate Bond ETF-429.6329,449.24-1.44%

ETF Weekly Flows By Asset Class

 Net Flows ($, mm)AUM ($, mm)% of AUM
U.S. Equity24,080.131,374,695.081.75%
International Equity-2,075.70488,644.76-0.42%
U.S. Fixed Income-3,098.76401,379.94-0.77%
International Fixed Income-705.9139,988.61-1.77%
Commodities-1,515.8668,427.16-2.22%
Currency-12.263,215.63-0.38%
Leveraged390.1223,900.641.63%
Inverse-712.0119,170.73-3.71%
Asset Allocation6.956,319.450.11%
Alternatives-136.854,050.61-3.38%
Total:16,219.852,429,792.620.67%

Top 10 Volume Surprises, Funds >$50 mm AUM

TickerNameAverage Volume
(30 Day)
1 Week Average
Volume
% of Average
COMTiShares Commodities Select Strategy ETF193,2101,207,237624.83%
HOLDAdvisorShares Sage Core Reserves ETF6,12125,373414.53%
VNQIVanguard Global ex-US Real Estate Index Fund546,4612,085,599381.66%
SIZEiShares MSCI USA Size Factor ETF8,07040,898506.81%
JKLiShares Morningstar Small Cap Value ETF7,77423,860306.91%
RCDGuggenheim S&P 500 Equal Weight Consumer Discretionary ETF5,98322,142370.08%
MVVProShares Ultra MidCap40044,351126,306284.79%
USTProShares Ultra 7-10 Year Treasury21,29188,395415.18%
ONEYSPDR Russell 1000 Yield Focus226601265.27%
ELDWisdomTree Emerging Markets Local Debt Fund92,114384,460417.38%

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.

 

Sumit Roy is the senior ETF analyst for etf.com, where he has worked for 13 years. He creates a variety of content for the platform, including news articles, analysis pieces, videos and podcasts.

Before joining etf.com, Sumit was the managing editor and commodities analyst for Hard Assets Investor. In those roles, he was responsible for most of the operations of HAI, a website dedicated to education about commodities investing.

Though he still closely follows the commodities beat, Sumit covers a much broader assortment of topics for etf.com, with a particular focus on stock and bond exchange-traded funds.

He is the host of etf.com’s Talk ETFs, a popular video series that features weekly interviews with thought leaders in the ETF industry. Sumit is also co-host of Exchange Traded Fridays, etf.com’s weekly podcast series.

He lives in the San Francisco Bay Area, where he enjoys climbing the city’s steep hills, playing chess and snowboarding in Lake Tahoe.