Displaying items by tag: inflows

According to Refinitiv Lipper’s fund flows, fixed income ETFs saw a net $4.5 billion in weekly outflows for the week ending on August 24th, 2022. This marked the group’s first weekly outflows in nine weeks. This also corresponded with bond ETF’s third straight week of average negative returns. The bond types with the largest outflows included corporate high yield ETFs with $3.0 billion in outflows, corporate investment grade ETFs with $733 million in outflows, and government Treasury ETFs with $570 million in weekly outflows. Corporate high yield ETFs had their eighth largest weekly outflows to date, while corporate investment grade ETFs saw their first week of outflows in eight weeks. However, not all fixed-income ETFs saw outflows. International & global debt ETFs saw $101 million in inflows and government mortgage ETFs saw $15 million in weekly inflows. Those were the only two fixed-income groups to report inflows.

Finsum:With fixed income ETFs seeing their third straight week of negative average returns, bond ETFs see their first outflows in nine weeks. 

Investors have been wary of tech stocks as of late and instead are parking their money in investment-grade corporate bond funds. This week the sector garnered a whopping $2.9 billion in inflows which is the biggest week since July, over six months ago. Markets are expecting the Fed to hike this year, which means borrowing rates will start to hurt the growth-oriented stock, and the Nasdaq slumped to its worst start since 2008 as a result. However, the rising yields are also pushing more investors into relatively riskless corporate debt. Junk bonds didn’t get the same bump as many indices were down with a hawkish Fed.

Finsum: Don’t sell on tech stocks just yet, but it could be a bearish year for the number one market segment the last year if the Fed hikes four times!

(New York)

One of the most ominous signs surrounding the equity market this year are the inflow numbers into stock funds. In 2017, $517.2 bn of new money flowed into US ETFs and mutual funds from the start of the year through September. This year that number is down by almost 50% for the same period, as only $281.7 bn has flowed in. Actively managed mutual funds are seeing net withdrawals. According to Deloitte “It feels like investors are in the early stages of positioning themselves for a potential downturn … [they] are returning to cash and relatively defensive positions”.

FINSUM: Retail inflows and outflows have never been a very good indicator of coming market performance (much like sentiment), so take these figures with a grain of salt.