Investment Grade Bond ETFs Favored

Despite a strong rally in stock markets, ETF investors favored investment-grade bond ETFs in the week-ending Thursday, Nov. 19.

ETF.com
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Reviewed by: etf.com Staff
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Edited by: etf.com Staff

A strong week for U.S. stocks translated into modest inflows for U.S. equity exchange-traded funds. The S&P 500 rallied 1.7% in the week ending Thursday, Nov. 19, fueling a relatively small $596 million into the segment. (Incidentally, the stock index rose by 3.3% in the week ending Friday, Nov. 20, but the following data runs through only Thursday.)

At the same time that ETF investors tiptoed into equities, they bought hefty positions in various bond ETFs. That's somewhat ironic, considering that the minutes to the Federal Reserve's October meeting, released on Wednesday, only strengthened the view that the central bank would hike its benchmark overnight interest rate In December for the first time in nearly 10 years.

Part of the reason for the strength in bonds this week may be anticipation of more stimulus from the European Central Bank on Dec. 3. If the ECB expands its QE program, that could pressure European bond yields (yields move inversely to price), filtering into lower U.S. yields as well.

Bonds & Oil Lead Inflows

The iShares Core U.S. Aggregate Bond ETF (AGG | A-98) picked up the most assets this week, at $890 million. The other bond fund that saw significant interest was the iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD | A-77), with inflows of $449 million.

When it came to bond funds this week, investors favored quality and shunned riskier high-yield products like the SPDR Barclays High Yield ETF (JNK | B-68), which had outflows of $150 million. Plunging oil prices reduced the appeal of junk bonds, which have a heavy energy sector weighting.

That said, while the oil plunge turned off some investors from high-yield bonds, others used the drop in crude to buy the oil-futures-linked United States Oil Fund (USO | B-100). That ETF saw a notable $391 million in flows during the week.

Meanwhile, the equity ETF to see the largest inflows this week was the Vanguard FTSE Developed Markets ETF (VEA | A-93), at $529 million.

Large-Caps Lead Outflows

On the other end of the spectrum, large-cap U.S. equity ETFs saw the biggest outflows. The SPDR S&P 500 (SPY | A-98) lost $1.8 billion; the PowerShares QQQ (QQQ | A-64) lost $353 million, and the SPDR Dow Jones Industrial Average Trust (DIA | A-85) shed $282 million.

Outside U.S. equities, the emerging markets heavyweight iShares MSCI Emerging Markets ETF (EEM | B-100) saw outflows of $337 million.

Top 10 Creations (All ETFs)

TickerNameNet Flows ($,mm)AUM ($, mm)AUM % Change
AGGiShares Core U.S. Aggregate Bond889.4529,772.843.08%
VEAVanguard FTSE Developed Markets529.1129,102.481.85%
LQDiShares iBoxx $ Investment Grade Corporate Bond449.1124,045.961.90%
USOUnited States Oil391.473,128.5414.30%
XLFFinancial Select SPDR314.5119,225.121.66%
XLIIndustrial Select SPDR224.346,824.343.40%
VOEVanguard Mid-Cap Value219.944,353.525.32%
BNDVanguard Total Bond Market219.1427,159.920.81%
AMLPAlerian MLP214.627,331.493.02%
UWTIVelocityShares 3X Long Crude Oil ETN208.331,070.5924.16%

Top 10 Redemptions (All ETFs)

TickerNameNet Flows ($,mm)AUM ($, mm)AUM % Change
SPYSPDR S&P 500-1,812.73178,841.63-1.00%
QQQPowerShares QQQ-353.3342,902.83-0.82%
EEMiShares MSCI Emerging Markets-336.8222,584.46-1.47%
DIASPDR Dow Jones Industrial Average Trust-282.2512,433.84-2.22%
IWMiShares Russell 2000-257.1027,608.30-0.92%
IVViShares Core S&P 500-204.7669,932.09-0.29%
JNKSPDR Barclays High Yield Bond-150.1210,621.03-1.39%
IWBiShares Russell 1000-148.7715,025.21-0.98%
IWNiShares Russell 2000 Value-127.405,869.84-2.12%
VCRVanguard Consumer Discretionary-122.022,019.55-5.70%

ETF Weekly Flows By Asset Class

Net Flows ($, mm)AUM ($, mm)% of AUM
U.S. Equity595.861,184,423.370.01%
International Equity363.90495,059.920.01%
U.S. Fixed Income1,745.48329,220.770.11%
International Fixed Income462.8827,361.110.34%
Commodities576.2348,178.770.24%
Currency-22.761,934.34-0.24%
Leveraged1,152.5624,583.910.97%
Inverse-315.5319,226.80-0.32%
Asset Allocation-4.865,441.70-0.02%
Alternatives56.773,314.470.34%
Total:4,610.532,138,745.160.04%

Top 10 Volume Surprises, Funds >$50 mm AUM

TickerNameAverage Volume
(30 Day)
1 Week Average
Volume
% of Average
DGTSPDR Global Dow4,05317,701436.74%
QCLNFirst Trust NASDAQ Clean Edge Green Energy24,63870,742287.13%
TIPZPIMCO Broad U.S. TIPS14,95337,283249.33%
SPYVSPDR S&P 500 Value8,45620,642244.10%
DBKODeutsche X-trackers MSCI South Korea Hedged Equity ETF265,983547,446205.82%
LTPZPIMCO 15+ Year U.S. TIPS24,52050,109204.36%
IWRiShares Russell Mid-Cap298,265740,046248.12%
IUSBiShares Core Total USD Bond Market7,84518,752239.03%
ATMPBarclays ETN+ Select MLP ETN128,900267,979207.90%
BSJIGuggenheim BulletShares 2018 High Yield Corporate Bond275,920672,135243.60%

Top 10 Weekly Performers, Excluding Leverage/Inverse Funds and <1,000 Shares Traded

TickerNameWeekly PerformanceWeekly VolumeAUM ($, mm)
ERUSiShares MSCI Russia Capped8.92%3,674,554241.94
RSXMarket Vectors Russia8.52%70,896,8501,949.98
RBLSPDR S&P Russia7.28%28,80826.02
CNHXCSOP MSCI China A International Hedged6.88%4,2003.16
EWZiShares MSCI Brazil Capped6.08%88,426,7441,983.29
RTMGuggenheim S&P Equal Weight Materials5.41%12,41256.06
PYZPowerShares DWA Basic Materials Momentum5.27%36,65764.04
GRIDFirst Trust NASDAQ Clean Edge Smart Grid Infrastructure5.12%2,28311.50
PLTMFirst Trust ISE Global Platinum4.92%50,4345.14
XPHSPDR S&P Pharmaceuticals4.89%428,476706.42

Bottom 10 Weekly Performers, Excluding Leverage/Inverse Funds and <1,000 Shares Traded

TickerNameWeekly PerformanceWeekly VolumeAUM ($, mm)
CVOLC-Tracks Citi Volatility ETN-7.68%750,8323.02
JJEiPath Bloomberg Energy Subindex Total Return ETN-7.16%4,5451.05
ICOLiShares MSCI Colombia Capped-5.60%76,64913.14
GXGGlobal X MSCI Colombia-5.18%790,40757.44
JJNiPath Bloomberg Nickel Subindex Total Return ETN-4.96%4,9615.58
JJCiPath Bloomberg Copper Subindex Total Return ETN-4.81%118,74934.27
SLVOCredit Suisse X-Links Silver Shares Covered Call ETN-4.52%108,99425.84
JJMiPath Bloomberg Industrial Metals Subindex Total Return ETN-4.37%5,6445.72
UBGETRACS CMCI Gold Total Return ETN-4.35%5,04510.82
LEDDiPath Pure Beta Lead ETN-4.09%7,6002.30

Top 10 YTD Performers

TickerNameYTD PerformanceWeekly PerformanceAUM ($, mm)
CNXTMarket Vectors ChinaAMC SME-ChiNext52.69%7.01%58.97
DXJHWisdomTree Japan Hedged Health Care36.34%2.39%14.03
ASHSDeutsche X-trackers Harvest CSI 500 China-A Shares Small Cap ETF34.02%5.54%37.65
FDNFirst Trust Dow Jones Internet23.96%3.49%4,679.14
PNQIPowerShares NASDAQ Internet20.12%3.97%262.17
RSXMarket Vectors Russia19.28%8.45%1,949.98
BBPBioShares Biotechnology Products18.80%1.94%23.27
DXJFWisdomTree Japan Hedged Financials18.73%1.19%26.88
DXJSWisdomTree Japan Hedged SmallCap Equity18.68%1.38%198.60
EDENiShares MSCI Denmark Capped18.11%2.94%68.38

Bottom 10 YTD Performers

TickerNameYTD PerformanceWeekly PerformanceAUM ($, mm)
GAZiPath Bloomberg Natural Gas Subindex Total Return ETN-67.02%-6.69%6.38
CVOLC-Tracks Citi Volatility ETN-59.50%-16.92%3.02
XMESPDR S&P Metals and Mining-47.04%1.19%234.38
PLTMFirst Trust ISE Global Platinum-46.98%3.43%5.14
KOLMarket Vectors Coal-46.83%1.30%49.50
FCGFirst Trust ISE-Revere Natural Gas-46.24%-0.84%210.50
JJNiPath Bloomberg Nickel Subindex Total Return ETN-45.30%-4.80%5.58
EWZSiShares MSCI Brazil Small-Cap-41.23%4.06%28.12
COPXGlobal X Copper Miners-40.81%0.84%16.75
NINIiPath Pure Beta Nickel ETN-40.77%-3.16%0.76

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.

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