During the week ending October 17, investors contributed a net total of $1.1 billion to U.S.-listed exchange-traded funds (ETFs), as reported by FactSet data. This week marked a notable divergence in investor behavior, prominently featuring outflows from U.S. equity ETFs, which dropped by $2.5 billion. Additionally, leveraged products faced another decline, losing $631 million.
In contrast, commodities ETFs enjoyed significant attention, attracting $1.8 billion. U.S. fixed income funds also garnered interest with $1.6 billion, while international equity ETFs experienced inflows of $1.1 billion, indicating a strong preference for diverse investment opportunities in a fluctuating market.
At the fund level, the SPDR S&P 500 ETF Trust (SPY) emerged as the frontrunner, seeing inflows of $1.8 billion. Close behind was the SPDR Gold Shares (GLD), which collected $1.7 billion as gold prices soared past $4,300 per ounce, delivering year-to-date gains exceeding 60%. This surge in gold investment reflects a broader trend where investors seek safe havens amid economic uncertainties.
International equity remains a favored choice among investors, with the JPMorgan BetaBuilders Europe ETF (BBEU) leading this category with nearly $700 million in inflows. On the fixed income side, the iShares U.S. Treasury Bond ETF (GOVT) received $380 million, followed by the iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD), which saw an inflow of $281 million.
However, some ETFs faced significant outflows. The Invesco QQQ Trust (QQQ) saw a sharp decline of $1.02 billion, followed by the FT Vest U.S. Equity Buffer ETF – October (FOCT) at $910 million, and the SPDR S&P Regional Banking ETF (KRE), which lost $569 million. The latter’s decline can be attributed to renewed concerns regarding the financial health of regional banks, leading to a short-lived sell-off in this sector.
Interestingly, the inflows and outflows reflect a broader investment strategy where investors are navigating volatile market conditions by reallocating their portfolios towards perceived safer assets. This trending behavior suggests that while some market segments face challenges, others like commodities and international equities present promising opportunities for growth.
Overall, this week’s ETF flows indicate a dynamic market environment, where investors are adapting their strategies in response to changing economic indicators and risks.