Weekly Flows Suggest Bargain Hunting In Miners, Selling In Utilities

August 26, 2016

The win streak for ETF flows continued this week, as investors added $1.5 billion into U.S.-listed exchange-traded funds, according to FactSet. For seven-straight weeks and counting, flows have been positive.

That said, unlike the across-the-board buying of past weeks, this week's flows were more uneven. In the week ending Thursday, Aug. 25, U.S. equity ETFs had outflows of $460 million; international equity ETFs had outflows of of nearly $300 million; and commodity ETFs had outflows of $260 million.

On the other hand, the $1.8 billion of inflows into U.S. fixed-income products more than made up for those outflows. International fixed-income products had inflows of about $220 million.

The renewed interest in fixed-income ETFs suggests that investors were feeling a bit nervous at the end of a quiet summer. According to CNBC, the S&P 500 hasn't closed 1% higher or lower for 34-straight sessions through Friday.

Bargain Hunting In Miners

Interestingly, though they saw an outflow on the whole, certain U.S. equity ETFs did well this week. The Vanguard S&P 500 Index Fund (VOO), for example, topped the creations list, with inflows of $440 million.

That was followed by the Energy Select Sector SPDR Fund (XLE), the largest ETF focused on energy stocks. Oil prices have had a great August thus far, rising almost 15% month-to-date.

Another inflows leaders this week was the Direxion Daily Gold Miners Index Bull 3x Shares (NUGT), with creations of $320 million. NUGT sold off more than 40% in the past two weeks, which may have prompted some traders to go bargain hunting.

Meanwhile, the VanEck Vectors Gold Miners ETF (GDX), the largest miners fund, had inflows of $182 million this week, likely for similar reasons.

USO & Europe Out Of Favor

In terms of outflows, the iShares Russell 2000 ETF (IWM) led all ETFs in redemptions, at $1.1 billion.

At the same time, the United States Oil Fund (USO) had outflows of $320 million, which contrasts with the inflows that the aforementioned XLE had.

Also falling out of favor were international equity funds, such as the iShares MSCI Eurozone ETF (EZU), the Deutsche X-trackers MSCI Europe Hedged Equity ETF (DBEU) and the WisdomTree Japan Hedged Equity Fund (DXJ), with outflows of $190 million to $280 million apiece.

Finally, the Utilities Select Sector SPDR Fund (XLU) was another loser of note. The fund had redemptions of $260 million, as utility stocks sagged on the back of higher interest rates.

The U.S. 10-year bond yield was last trading at 1.63%, a two-month high, after Fed Chair Janet Yellen suggested the central bank could raise interest rates in the coming months.
 

Top 10 Creations (All ETFs)

Ticker Name Net Flows ($,mm) AUM ($, mm) AUM % Change
VOO Vanguard S&P 500 Index Fund 442.80 51,024.79 0.88%
XLE Energy Select Sector SPDR Fund 336.35 14,881.04 2.31%
NUGT Direxion Daily Gold Miners Index Bull 3x Shares 322.10 7,389.08 4.56%
IJR iShares Core S&P Small Cap ETF 303.29 20,481.47 1.50%
AGG iShares Core U.S. Aggregate Bond ETF 258.91 41,192.33 0.63%
VXX iPath S&P 500 VIX Short-Term Futures ETN 227.65 1,833.22 14.18%
QQQ PowerShares QQQ Trust 214.11 40,563.33 0.53%
VCSH Vanguard Short-Term Corporate Bond Index Fund 185.37 14,008.25 1.34%
GDX VanEck Vectors Gold Miners ETF 181.59 9,879.62 1.87%
JNK SPDR Barclays High Yield Bond ETF 164.00 12,463.88 1.33%

Top 10 Redemptions (All ETFs)

Ticker Name Net Flows ($,mm) AUM ($, mm) AUM % Change
IWM iShares Russell 2000 ETF -1,122.20 28,245.00 -3.82%
SPY SPDR S&P 500 ETF Trust -906.26 198,816.23 -0.45%
USO United States Oil Fund LP -324.21 3,128.57 -9.39%
EZU iShares MSCI Eurozone ETF -277.96 8,362.88 -3.22%
DBEU Deutsche X-trackers MSCI Europe Hedged Equity ETF -270.16 2,641.83 -9.28%
XLU Utilities Select Sector SPDR Fund -263.09 7,959.95 -3.20%
DXJ WisdomTree Japan Hedged Equity Fund -192.45 6,810.08 -2.75%
DIA SPDR Dow Jones Industrial Average ETF Trust -186.34 12,161.88 -1.51%
XLF Financial Select Sector SPDR Fund -175.27 15,691.21 -1.10%
UWTI VelocityShares 3x Long Crude Oil ETN -171.02 1,212.25 -12.36%

ETF Weekly Flows By Asset Class

  Net Flows ($, mm) AUM ($, mm) % of AUM
U.S. Equity -455.18 1,331,288.31 -0.03%
International Equity -297.90 510,025.67 -0.06%
U.S. Fixed Income 1,822.49 402,751.32 0.45%
International Fixed Income 216.31 40,918.24 0.53%
Commodities -255.72 75,536.77 -0.34%
Currency -18.94 1,436.66 -1.32%
Leveraged -51.40 27,215.49 -0.19%
Inverse 239.16 19,353.25 1.24%
Asset Allocation 83.11 6,410.84 1.30%
Alternatives 227.94 4,358.22 5.23%
Total: 1,509.86 2,419,294.77 0.06%

Top 10 Volume Surprises, Funds >$50 mm AUM

Ticker Name Average Volume
(30 Day)
1 Week Average
Volume
% of Average
PXSV PowerShares Russell 2000 Pure Value Portfolio 11,287 35,320 312.93%
INKM SPDR SSgA Income Allocation ETF 10,264 36,952 360.03%
MDD SPDR S&P International Mid Cap ETF 13,532 47,383 350.14%
GURU Global X Guru Index ETF 28,198 70,932 251.55%
FSZ First Trust Switzerland AlphaDEX Fund 8,837 21,303 241.06%
IBME iShares iBonds Sep 2016 Term Muni Bond ETF 10,638 23,202 218.10%
GAL SPDR SSgA Global Allocation ETF 19,108 40,752 213.26%
MBG SPDR Barclays Mortgage Backed Bond ETF 20,136 40,199 199.63%
BSCM Guggenheim BulletShares 2022 Corporate Bond ETF 76,499 150,527 196.77%
BWX SPDR Barclays International Treasury Bond ETF 305,725 639,643 209.22%

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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