Market Turmoil Spooks Bonds, Not Equities
Investors pulled money out of U.S.-listed ETFs this week, but equity ETFs registered inflows, while fixed-income ETFs registered outflows.
Tumultuous action in the stock and bond markets sent investors fleeing ETFs. The S&P 500 had its biggest drawdown since March this week, and the U.S. 10-year Treasury yield spiked to a seven-year high, prompting $2.9 billion to flow out of U.S.-listed ETFs.
Despite the stock market volatility—the S&P 500 fell as much as 7.8% from its all-time high—it wasn’t stocks that most ETF investors were dumping. In fact, almost $2 billion flowed into U.S. equity ETFs, according to the latest data from FactSet.
Conversely, a hefty $6.2 billion came out of U.S. fixed-income ETFs as the jump in Treasury yields spooked fixed-income investors out of their positions.
Corporate bond ETFs, in particular, fell swiftly out of favor. Funds like the iShares iBoxx USD High Yield Corporate Bond ETF (HYG), the SPDR Bloomberg Barclays High Yield Bond ETF (JNK) and the iShares iBoxx USD Investment Grade Corporate Bond ETF (LQD) had billions of dollars worth of outflows this week.
But not all fixed-income ETFs were shunned. The iShares 20+ Year Treasury Bond ETF (TLT) and the SPDR Bloomberg Barclays 1-3 Month T-Bill ETF (BIL) actually found themselves on the top inflows list for the week, as some investors used the bond sell-off to lock in higher rates.
Meanwhile, on the equity side, the SPDR S&P 500 ETF Trust (SPY), the Vanguard S&P 500 ETF Trust (VOO), the iShares MSCI Japan ETF (EWJ) and the J.P. Morgan Alerian MLP Index ETN (AMJ) had the largest inflows during the week.
Though stocks fell notably this week, the data suggest that ETF investors weren’t panicking; on the contrary, they used the pullback as an opportunity to buy.
For a full list of this week’s top inflows and outflows, see the tables below:
Top 10 Creations (All ETFs)
| Ticker | Name | Net Flows ($,mm) | AUM ($, mm) | AUM % Change |
| SPY | SPDR S&P 500 ETF Trust | 5,653.29 | 273,776.35 | 2.11% |
| VOO | Vanguard S&P 500 ETF | 1,187.29 | 101,320.90 | 1.19% |
| DIA | SPDR Dow Jones Industrial Average ETF Trust | 684.41 | 22,862.87 | 3.09% |
| TLT | iShares 20+ Year Treasury Bond ETF | 586.93 | 8,423.42 | 7.49% |
| EWJ | iShares MSCI Japan ETF | 567.26 | 17,360.20 | 3.38% |
| TQQQ | ProShares UltraPro QQQ | 519.05 | 3,812.85 | 15.76% |
| AMJ | J.P. Morgan Alerian MLP Index ETN | 511.40 | 3,793.36 | 15.58% |
| XLC | Communication Services Select Sector SPDR Fund | 491.38 | 2,766.51 | 21.60% |
| BIL | SPDR Bloomberg Barclays 1-3 Month T-Bill ETF | 466.48 | 4,010.65 | 13.16% |
| IXUS | iShares Core MSCI Total International Stock ETF | 411.84 | 10,887.39 | 3.93% |
Top 10 Redemptions (All ETFs)
| Ticker | Name | Net Flows ($,mm) | AUM ($, mm) | AUM % Change |
| HYG | iShares iBoxx USD High Yield Corporate Bond ETF | -2,756.16 | 13,051.40 | -17.44% |
| IWB | iShares Russell 1000 ETF | -2,754.04 | 17,631.66 | -13.51% |
| AGG | iShares Core U.S. Aggregate Bond ETF | -2,193.77 | 53,189.39 | -3.96% |
| JNK | SPDR Bloomberg Barclays High Yield Bond ETF | -1,333.43 | 8,003.89 | -14.28% |
| LQD | iShares iBoxx USD Investment Grade Corporate Bond ETF | -1,243.01 | 32,192.09 | -3.72% |
| QQQ | Invesco QQQ Trust | -712.26 | 66,004.52 | -1.07% |
| XOP | SPDR S&P Oil & Gas Exploration & Production ETF | -547.18 | 3,142.11 | -14.83% |
| ICF | iShares Cohen & Steers REIT ETF | -528.43 | 1,901.04 | -21.75% |
| XLI | Industrial Select Sector SPDR Fund | -451.68 | 12,257.10 | -3.55% |
| XLK | Technology Select Sector SPDR Fund | -435.56 | 20,490.91 | -2.08% |
ETF Weekly Flows By Asset Class
| Net Flows ($, mm) | AUM ($, mm) | % of AUM | |
| U.S. Equity | 1,951.31 | 2,076,683.81 | 0.09% |
| International Equity | 318.61 | 759,588.89 | 0.04% |
| U.S. Fixed Income | -6,166.70 | 558,161.17 | -1.10% |
| International Fixed Income | 182.39 | 65,313.89 | 0.28% |
| Commodities | 346.92 | 59,743.31 | 0.58% |
| Currency | 7.45 | 1,096.91 | 0.68% |
| Leveraged | 945.41 | 35,236.63 | 2.68% |
| Inverse | -350.50 | 13,602.24 | -2.58% |
| Asset Allocation | 14.90 | 9,196.07 | 0.16% |
| Alternatives | -147.90 | 4,983.71 | -2.97% |
| Total: | -2,898.12 | 3,583,606.63 | -0.08% |
Asset Classes (Year-to-Date)
| Net Flows ($, mm) | AUM ($, mm) | % of AUM | |
| U.S. Equity | 99,712.50 | 2,076,683.81 | 4.80% |
| International Equity | 38,044.66 | 759,588.89 | 5.01% |
| U.S. Fixed Income | 52,289.81 | 558,161.17 | 9.37% |
| International Fixed Income | 10,076.24 | 65,313.89 | 15.43% |
| Commodities | -1,221.81 | 59,743.31 | -2.05% |
| Currency | -85.31 | 1,096.91 | -7.78% |
| Leveraged | 4,341.63 | 35,236.63 | 12.32% |
| Inverse | 2,532.81 | 13,602.24 | 18.62% |
| Asset Allocation | 684.33 | 9,196.07 | 7.44% |
| Alternatives | 545.56 | 4,983.71 | 10.95% |
| Total: | 206,920.44 | 3,583,606.63 | 5.77% |
Top 10 Volume Surprises, Funds >$50 mm AUM
| Ticker | Name | Average Volume (30 Day) | 1 Week Average Volume | % of Average |
| AGGE | IQ Enhanced Core Bond U.S. ETF | 44,504 | 298,609 | 670.96% |
| PSC | Principal U.S. Small-Cap Multi-Factor Index ETF | 1,188 | 4,823 | 406.02% |
| ROBO | ROBO Global Robotics and Automation Index ETF | 403,216 | 1,554,020 | 385.41% |
| QEFA | SPDR MSCI EAFE StrategicFactors ETF | 30,566 | 116,290 | 380.45% |
| AGGP | IQ Enhanced Core Plus Bond U.S. ETF | 126,992 | 471,678 | 371.42% |
| JPMB | JPMorgan USD Emerging Markets Sovereign Bond ETF | 1,246 | 4,432 | 355.79% |
| ARCM | Arrow Reserve Capital Management ETF | 101 | 353 | 351.19% |
| CLRG | IQ Chaikin U.S. Large Cap ETF | 211,551 | 712,075 | 336.60% |
| XNTK | SPDR NYSE Technology ETF | 26,208 | 84,478 | 322.34% |
| VMOT | Alpha Architect Value Momentum Trend ETF | 20,130 | 62,329 | 309.64% |
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.
