Junk Bond & Emerging Market ETFs See Mega Inflows

Oct 23, 2015

Reviewed by: etf.com Staff

Edited by: etf.com Staff

Hundreds of millions of dollar continued to flow into U.S. corporate bond ETFs this week, as investors speculated that interest rates would stay lower for longer. Three products in particular remain extremely popular: the iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD | A-77), the iShares iBoxx $ High Yield Corporate Bond ETF (HYG | B-64) and the SPDR Barclays High Yield Bond ETF (JNK | B-68).

The three ETFs gathered a combined $2.1 billion in assets this week alone. For the month as a whole, the trio has gained a whopping $6 billion in assets. These are no small funds by any means, but even for their size, these are hefty inflows.

In addition to expectations that the Fed may not hike interest rates this year, investors are also betting that the fears about an economic slowdown and the potential for widespread corporate defaults that were prevelent in August and September were overblown.

At one point in September, junk bond yields touched their highest levels since 2011, a time when the the eurozone sovereign debt crisis was raging. Clearly, those high yields were attractive to many ETF investors.

Outside the corporate bond space, another area that had significant inflows this week was emerging markets. The iShares Core MSCI Emerging Markets ETF (IEMG | A-99) and the iShares MSCI Emerging Markets ETF (EEM | B-100) gathered a combined $1 billion in assets.

As with junk bonds, investors may believe that the worst for emerging markets is in the rearview mirror and that all the bad news is already priced in.

Altogether, U.S. ETFs had $6.8 billion in inflows in the week ending Thursday, Oct. 22, putting total assets at $2.1 trillion

Top 10 Creations (All ETFs)

Ticker	Name	Net Flows ($,mm)	AUM ($, mm)	AUM % Change
LQD	iShares iBoxx $ Investment Grade Corporate Bond	898.74	24,583.13	3.79%
HYG	iShares iBoxx $ High Yield Corporate Bond	730.65	14,691.31	5.23%
MDY	SPDR S&P MidCap 400	599.85	15,145.95	4.12%
IEMG	iShares Core MSCI Emerging Markets	517.86	8,512.02	6.48%
EEM	iShares MSCI Emerging Markets	513.61	23,669.64	2.22%
EZU	iShares MSCI EMU	502.92	13,100.56	3.99%
BIV	Vanguard Intermediate-Term Bond	501.47	7,436.11	7.23%
AGG	iShares Core U.S. Aggregate Bond	460.65	27,733.71	1.69%
SHY	iShares 1-3 Year Treasury Bond	458.93	13,665.93	3.47%
JNK	SPDR Barclays High Yield Bond	445.04	11,285.24	4.11%

Top 10 Redemptions (All ETFs)

Ticker	Name	Net Flows ($,mm)	AUM ($, mm)	AUM % Change
SPY	SPDR S&P 500	-2,200.19	176,090.08	-1.23%
SHV	iShares Short Treasury Bond	-540.47	3,639.57	-12.93%
XLI	Industrial Select SPDR	-433.83	7,202.89	-5.68%
IEI	iShares 3-7 Year Treasury Bond	-411.38	5,687.69	-6.74%
DBEF	Deutsche X-trackers MSCI EAFE Hedged Equity ETF	-301.48	13,696.92	-2.15%
IEF	iShares 7-10 Year Treasury Bond	-248.27	9,666.90	-2.50%
IWM	iShares Russell 2000	-235.79	26,686.04	-0.88%
GDX	Market Vectors Gold Miners	-201.45	4,955.18	-3.91%
IVV	iShares Core S&P 500	-194.56	68,466.93	-0.28%
SMH	Market Vectors Semiconductor	-171.85	281.73	-37.89%

ETF Weekly Flows By Asset Class

	Net Flows ($, mm)	AUM ($, mm)	% of AUM
U.S. Equity	1,492.73	1,145,836.80	0.13%
International Equity	1,738.19	489,504.66	0.36%
U.S. Fixed Income	3,344.04	332,036.28	1.01%
International Fixed Income	104.90	27,002.77	0.39%
Commodities	15.19	52,988.74	0.03%
Currency	7.58	1,346.93	0.56%
Leveraged	141.17	23,526.64	0.60%
Inverse	-124.79	20,490.96	-0.61%
Asset Allocation	-6.24	5,484.00	-0.11%
Alternatives	62.67	3,145.92	1.99%
Total:	6,775.45	2,101,363.70	0.32%

Top 10 Volume Surprises, Funds >$50 mm AUM

Ticker	Name	Average Volume (30 Day)	1 Week Average Volume	% of Average
DIVC	C-Tracks Miller/Howard Strategic Dividend Reinvestor ETN	58,927	325,250	551.95%
JPGE	JPMorgan Diversified Return Global Equity	7,851	29,527	376.09%
BSJJ	Guggenheim BulletShares 2019 High Yield Corporate Bond	72,336	236,987	327.62%
HYXU	iShares Global ex USD High Yield Corporate Bond	46,586	140,634	301.88%
RHS	Guggenheim S&P Equal Weight Consumer Staples	92,116	272,915	296.27%
PXE	PowerShares Dynamic Energy Exploration & Production	29,612	86,865	293.34%
TUZ	PIMCO 1-3 Year U.S. Treasury	29,171	85,558	293.30%
FDM	First Trust Dow Jones Select Micro Cap	6,324	18,183	287.51%
IBCD	iShares iBonds Mar 2020 Corporate ex-Financials	1,592	4,537	284.96%
LDUR	PIMCO Low Duration	2,885	8,155	282.68%

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

Ticker	Name	Weekly Performance	Weekly Volume	AUM ($, mm)
HEWY	iShares Currency Hedged MSCI South Korea	8.38%	1,025	2.49
ROGS	Lattice Global Small Cap Strategy	7.10%	2,611	7.17
SLDR	ALPS Sector Leaders	6.47%	1,509	1.22
FIW	First Trust ISE Water	5.52%	154,010	111.25
HFEZ	SPDR EURO STOXX 50 Currency Hedged	5.22%	43,856	7.36
JDG	WisdomTree Japan Quality Dividend Growth	4.92%	1,924	2.31
DXJF	WisdomTree Japan Hedged Financials	4.87%	37,296	25.79
EMRE	Guggenheim Emerging Markets Real Estate	4.80%	2,464	2.19
XLRE	Real Estate Select Sector SPDR	4.58%	8,221	4.71
FKO	First Trust South Korea AlphaDex	4.37%	15,500	3.69

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

Ticker	Name	Weekly Performance	Weekly Volume	AUM ($, mm)
VXUP	AccuShares Spot CBOE VIX Up Shares	-52.79%	113,003	0.10
CVOL	C-Tracks Citi Volatility ETN	-12.12%	864,375	2.97
JO	iPath Bloomberg Coffee Subindex Total Return ETN	-10.46%	864,272	109.89
CAFE	iPath Pure Beta Coffee ETN	-10.34%	22,025	5.11
CNCR	Loncar Cancer Immunotherapy	-9.14%	457,520	10.53
XPH	SPDR S&P Pharmaceuticals	-8.61%	1,656,214	662.83
SGDJ	Sprott Junior Gold Miners	-7.77%	33,328	26.11
GAZ	iPath Bloomberg Natural Gas Subindex Total Return ETN	-7.51%	91,804	8.28
VIXY	ProShares VIX Short-Term	-7.39%	10,756,391	88.48
VXX	iPath S&P 500 VIX Short-Term Futures ETN	-7.34%	358,784,756	870.36

Top 10 YTD Performers

Ticker	Name	YTD Performance	Weekly Performance	AUM ($, mm)
CNXT	Market Vectors ChinaAMC SME-ChiNext	0.40	-1.20	57.84
ASHS	Deutsche X-trackers Harvest CSI 500 China-A Shares Small Cap ETF	0.21	-1.89	42.01
DXJH	WisdomTree Japan Hedged Health Care	0.21	0.81	10.71
GRN	iPath Global Carbon ETN	0.19	4.95	2.56
DFJ	WisdomTree Japan SmallCap Dividend	0.17	1.35	341.21
RSX	Market Vectors Russia	0.17	-2.34	2,000.12
EIRL	iShares MSCI Ireland Capped	0.17	-0.68	165.82
FDN	First Trust Dow Jones Internet	0.17	-0.03	3,773.21
DXJF	WisdomTree Japan Hedged Financials	0.16	3.20	25.79
DXJS	WisdomTree Japan Hedged SmallCap Equity	0.16	1.97	190.40

Bottom 10 YTD Performers

Ticker	Name	YTD Performance	Weekly Performance	AUM ($, mm)
CVOL	C-Tracks Citi Volatility ETN	-0.59	-11.98	2.97
GAZ	iPath Bloomberg Natural Gas Subindex Total Return ETN	-0.58	-5.81	8.28
XTN	SPDR S&P Transportation	-0.56	1.66	278.54
XHS	SPDR S&P Health Care Services	-0.52	-7.84	178.00
XSW	SPDR S&P Software & Services	-0.48	-0.43	52.39
XSD	SPDR S&P Semiconductor	-0.46	1.72	140.66
EWZS	iShares MSCI Brazil Small-Cap	-0.44	0.52	25.18
BRF	Market Vectors Brazil Small-Cap	-0.44	-0.42	69.88
BRXX	EGShares Brazil Infrastructure	-0.42	-1.80	9.00
VIIX	VelocityShares VIX Short Term ETN	-0.42	-6.13	7.40

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.

etf.com Staff

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Junk Bond & Emerging Market ETFs See Mega Inflows

Junk Bond & Emerging Market ETFs See Mega Inflows

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