Investors Add $5B To ETFs Despite Volatility Surge

The highest VIX reading of the year didn't stop investors from adding to their ETF positions.

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

A sudden spike in stock market volatility didn't faze investors this week, at least judging by the latest flows into ETFs. According to FactSet, investors added $5 billion to U.S.-listed exchange-traded funds during the week ending Thursday, Aug. 10.

The period includes Thursday, when the S&P 500 dropped 1.5% and the CBOE Volatility Index (VIX) jumped to its highest level of the year above 16, as geopolitical tensions flared between the U.S. and North Korea.

Most asset classes had inflows. U.S equity ETFs took in $1.7 billion; international equity ETFs took in $1.9 billion; U.S. fixed-income ETFs took in $1.1 billion; and international fixed-income ETFs took in almost $200 million.

Year-to-date, net inflows for U.S.-listed ETFs now stand at $285.1 billion, just a hair below 2016's annual record of $287.5 billion.

Bargain Buying In 'SVXY'
The inflows list was chock full of the usual suspects―broad, low-cost index ETFs like the SPDR Dow Jones Industrial Average ETF (DIA) and the SPDR S&P 500 ETF (SPY).

Standing out like a sore thumb on the list was the ProShares Short VIX Short-Term Futures ETF (SVXY). Its inflows of about $350 million were enough to put the fund at No. 5 on the list, and suggests that traders were using the VIX spike as an opportunity to bet against volatility.

Indeed, shorting volatility has been one of the best trades of the year, returning more than 55%, even accounting for the recent surge in the VIX. 

No Love For Safe-Haven ETFs
Meanwhile, on the outflows list, the SPDR Bloomberg Barclays High Yield Bond ETF (JNK) took the top spot, with redemptions of $520 million.

Surprisingly, a number of ETFs tied to what are traditionally considered safe-haven areas of the market also saw selling. The Consumer Staples Select Sector SPDR Fund (XLP) had outflows of around $470 million, while the iShares 20+ Year Treasury Bond ETF (TLT) had outflows of $250 million.

At the same time, the SPDR Gold Trust (GLD) and the VanEck Vectors Gold Miners ETF (GDX) had outflows of just under $200 million apiece, even as gold prices rallied to two-month highs around $1,300/oz this week. 

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
DIASPDR Dow Jones Industrial Average ETF Trust981.8917,766.935.85%
SPYSPDR S&P 500 ETF Trust687.48241,320.740.29%
XLIIndustrial Select Sector SPDR Fund619.2211,883.225.50%
VEUVanguard FTSE All-World ex-US ETF468.7220,180.992.38%
SVXYProShares Short VIX Short-Term Futures ETF354.98727.3195.34%
VEAVanguard FTSE Developed Markets ETF297.4059,588.530.50%
VWOVanguard FTSE Emerging Markets ETF284.9560,565.070.47%
AGGiShares Core U.S. Aggregate Bond ETF273.7948,932.290.56%
VCSHVanguard Short-Term Corporate Bond ETF256.3320,424.111.27%
XLVHealth Care Select Sector SPDR Fund234.7917,880.231.33%

Top 10 Redemptions (All ETFs)

TickerNameNet Flows ($,mm)AUM ($, mm)AUM % Change
JNKSPDR Bloomberg Barclays High Yield Bond ETF-519.6411,982.81-4.16%
XLPConsumer Staples Select Sector SPDR Fund-470.868,492.34-5.25%
IWDiShares Russell 1000 Value ETF-286.7036,733.03-0.77%
MDYSPDR S&P Midcap 400 ETF Trust-270.4718,499.74-1.44%
XLEEnergy Select Sector SPDR Fund-260.8415,123.31-1.70%
TLTiShares 20+ Year Treasury Bond ETF-249.916,814.17-3.54%
EWGiShares MSCI Germany ETF-213.524,906.22-4.17%
GLDSPDR Gold Trust-192.8931,918.96-0.60%
GDXVanEck Vectors Gold Miners ETF-192.017,048.53-2.65%
EZUiShares MSCI Eurozone ETF-183.5613,669.92-1.33%

ETF Weekly Flows By Asset Class

 Net Flows ($, mm)AUM ($, mm)% of AUM
U.S. Equity1,683.821,699,720.270.10%
International Equity1,875.08708,823.400.26%
U.S. Fixed Income1,141.24492,715.780.23%
International Fixed Income173.3652,998.170.33%
Commodities-240.2261,367.27-0.39%
Currency-17.531,405.20-1.25%
Leveraged-313.1628,428.10-1.10%
Inverse578.5816,839.273.44%
Asset Allocation-39.337,418.99-0.53%
Alternatives196.744,178.374.71%
Total:5,038.593,073,894.820.16%

Top 10 Volume Surprises, Funds >$50 mm AUM

TickerNameAverage Volume
(30 Day)
1 Week Average
Volume
% of Average
MDYVSPDR S&P 400 Mid Cap Value ETF51,042285,032558.43%
HFXEIQ 50 Percent Hedged FTSE Europe ETF34,394159,072462.49%
MDYGSPDR S&P 400 Mid Cap Growth ETF36,780159,408433.41%
HYZDWisdomTree Interest Rate Hedged High Yield Bond Fund33,364136,506409.14%
AFKVanEck Vectors Africa Index ETF13,28849,279370.85%
SLYGSPDR S&P 600 Small Cap Growth ETF22,57165,124288.53%
SLYVSPDR S&P 600 Small Cap Value ETF45,275115,031254.07%
BBRCColumbia Beyond BRICs ETF5,52413,982253.09%
AOAiShares Core Aggressive Allocation ETF55,287138,789251.03%
CSMLIQ Chaikin U.S. Small Cap ETF81,994171,182208.77%

 

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.