$500B In New ETF Assets For 2017 Nears

From strong demand to bitcoin’s impact on ETF performance, this week’s numbers are noteworthy. 

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Reviewed by: Cinthia Murphy
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Edited by: Cinthia Murphy

Investors poured nearly $30 billion into U.S.-listed ETFs in the past week, bringing total net creations so far in 2017 to $466 billion.

The massive, record asset-gathering pace now sits just inches away from what could be a new milestone for the ETF market: $500 billion in net inflows in one calendar year. With two weeks to go in December, hitting $500 billion seems very likely.

For perspective, consider that 2016 also saw record-breaking asset gathering in the U.S. ETF space, with net creations reaching $287.5 billion last year. We are on pace to almost double that haul in 2017. What’s more, combined with performance, the asset inflows grew the ETF market to $3.4 trillion in total assets—that’s almost $1 trillion bigger than where the market sat a short year ago.

The bulk of the demand continues to center on some of the cheapest, most traded and most popular ETFs by the largest ETF providers: iShares, Vanguard and State Street. In the past week specifically, the driving asset class was U.S. equities, which saw some $25 billion in net inflows, and dominated the top creations list. The SPDR S&P 500 ETF Trust (SPY) alone saw a massive $10 billion in net inflows in a week.

Value Returns

Perhaps most notable among the top funds in the week was the demand for value ETFs—a factor that has lagged other factors this year and has underperformed the S&P 500.

Still, the iShares S&P 500 Value ETF (IVE), the iShares S&P Mid-Cap 400 Value ETF (IJJ) and the iShares S&P Small-Cap 600 Value ETF (IJS) attracted a combined $4.8 billion in assets in a week. These ETFs are up anywhere from 10 to 14% year-to-date.

 

 

Small-Cap Biggest Net Losers

On the redemptions side, no fund was as unpopular as the largest U.S. small-cap ETF, the iShares Russell 2000 ETF (IWM). The fund faced more than $2.1 billion in net outflows in a week.

So far in 2017, small-caps have had a rocky year, marked by underperformance relative to larger-cap names.

 

 

Bitcoin’s Impact On ETFs

On the performance side, it’s worth noting that the bitcoin craze has impacted ETFs. Outside of a short volatility strategy, the two best-performing ETFs year-to-date are the only two that currently offer any exposure to bitcoins: the ARK Web x.0 ETF (ARKW) and the ARK Innovation ETF (ARKK). They are each up more than 87% this year. ARKW has 8.8% of its portfolio in bitcoins, and ARKK has 8.2%—both achieved via allocations to the Grayscale Bitcoin Trust (GBTC). 

 

Top 10 Creations (All ETFs)

TickerNameNet Flows ($,mm)AUM ($, mm)AUM % Change
SPYSPDR S&P 500 ETF Trust9,991.95271,464.543.82%
IVEiShares S&P 500 Value ETF2,251.9417,442.7514.82%
IJJiShares S&P Mid-Cap 400 Value ETF1,404.167,250.4724.02%
IJSiShares S&P Small-Cap 600 Value ETF1,196.336,431.1722.85%
VTIVanguard Total Stock Market ETF1,030.3592,200.071.13%
VUGVanguard Growth ETF979.3632,270.283.13%
VBVanguard Small-Cap ETF928.5222,208.264.36%
IVViShares Core S&P 500 ETF856.06142,884.630.60%
SHViShares Short Treasury Bond ETF606.367,828.088.40%
HDViShares Core High Dividend ETF581.397,314.908.63%

Top 10 Redemptions (All ETFs)

TickerNameNet Flows ($,mm)AUM ($, mm)AUM % Change
IWMiShares Russell 2000 ETF-2,179.2344,703.37-4.65%
HYGiShares iBoxx $ High Yield Corporate Bond ETF-671.9818,615.69-3.48%
SMHVanEck Vectors Semiconductor ETF-405.761,017.85-28.50%
ITOTiShares Core S&P Total U.S. Stock Market ETF-364.9612,480.68-2.84%
HEDJWisdomTree Europe Hedged Equity Fund-322.307,977.90-3.88%
IYRiShares U.S. Real Estate ETF-277.674,104.80-6.34%
SVXYProShares Short VIX Short-Term Futures ETF-201.641,052.20-16.08%
VWOVanguard FTSE Emerging Markets ETF-183.1164,682.39-0.28%
IWOiShares Russell 2000 Growth ETF-165.569,338.34-1.74%
TQQQProShares UltraPro QQQ-150.072,408.70-5.86%

ETF Weekly Flows By Asset Class

 Net Flows ($, mm)AUM ($, mm)% of AUM
U.S. Equity25,323.881,921,545.991.32%
International Equity1,889.07783,138.190.24%
U.S. Fixed Income1,419.15523,085.680.27%
International Fixed Income285.9357,690.000.50%
Commodities 234.0964,325.480.36%
Currency-39.651,242.88-3.19%
Leveraged152.0733,349.490.46%
Inverse-300.2116,202.13-1.85%
Asset Allocation36.658,926.570.41%
Alternatives133.304,253.143.13%
Total:29,134.283,413,759.540.85%

Top 10 Volume Surprises, Funds >$50 mm AUM

TickerNameAverage Volume
(30 Day)
1 Week Average
Volume
% of Average
NFRAFlexShares STOXX Global Broad Infrastructure Index Fund34,197131,350384.10%
TPYPTortoise North American Pipeline Fund45,747163,054356.42%
PUIPowerShares DWA Utilities Momentum Portfolio10,62135,595335.14%
EFViShares MSCI EAFE Value ETF449,2281,552,694345.64%
PXEPowerShares Dynamic Energy Exploration & Production Portfolio14,28446,946328.66%
TDIVFirst Trust NASDAQ Technology Dividend Index Fund74,191234,239315.72%
ONEOSPDR Russell 1000 Momentum Focus8,94823,545263.12%
HYGHiShares Interest Rate Hedged High Yield Bond ETF13,04128,272216.79%
IWYiShares Russell Top 200 Growth ETF164,873354,775215.18%
ACWViShares Edge MSCI Min Vol Global ETF181,086416,178229.82%

 

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.

 

Cinthia Murphy is head of digital experience, advocating for the user in all that etf.com does. She previously served as managing editor and writer for etf.com, specializing in ETF content and multimedia. Cinthia’s experience includes time at Dow Jones and former BridgeNews, covering commodity futures markets in Chicago and Brazil equities in Sao Paulo. She has a bachelor’s degree in journalism from the University of Missouri-Columbia.