New Data: ETF Net Fund Flows
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- 1 Year
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What are Net Fund Flows?
Investors and analysts watch fund flows as investor sentiment within specific asset classes, sectors, or the market as a whole. For instance, if net fund flows for bond funds during a given month are negative by a large amount, this signals broad-based pessimism over the fixed-income markets.
A couple of things to note: fund flows do not reflect the performance of the investment, only how investors move their money. Outflows reflect redemptions – or when investors take their money out of a fund – and fund expenses, while inflows reflect fund purchases. Net fund flows are the difference between the inflows and outflows.
In this example, three net flow timeframes have been added to a watchlist of the SPDR sector and bond ETFs:
Click images to enlarge
So far this year, the SPDR S&P 500 ETF ($SPY) has had $20.6 billion pulled out of the fund (see the Net Flows YTD column). Of the sectors, Financials ($XLF) has lost $7.8 billion year-to-date, with Health Care ($XLV) gaining $6.2 billion. Over the last month, Technology ($XLK) has gained $1.4 billion and is now positive year-to-date. Not surprisingly given the equity market conditions for the majority of the year, more money has flowed in to bonds, with $27.6 billion flowing in to the seven listed (a third of that in to iShares 20+ Year Treasury ETF ($TLT).
Of course, some funds are bigger than others so one way to compare net flows across funds is to calculate it as a percentage of Assets Under Management. This can be calculated in a watchlist column using this formula (using 1 month net flows):
NF1=DATAFIELD(FEED=FD, FIELD=NetFlows1Month, LATESTONLY=True);
AUM1=DATAFIELD(FEED=FD, FIELD=AssetsUnderManagement, LATESTONLY=True);
NF1 / AUM1
Over the last month, Consumer Discretionary ($XLY) has gained 5.6% of its assets from inflows, which – combined with a price gain of 18% – led to a 26% gain in Assets under Management (AUM). By contrast, the iShares TIPS Bond ETF ($TIP) lost 5% of their AUM.
Here’s an example in the Invesco QQQ Trust ($QQQ) which tracks the Nasdaq 100 index. Both the price and monthly flows declined at the beginning of the year, but then starting in February fund inflows started to outpace redemptions six weeks before the price bottomed in mid-March. By that time net flows were positive again, helping to push the price higher:
Clients with US Equity and Fundamental data can click the button below to save and open a workbook containing the SPDR and bond ETFs flows. As always, if you have any questions or need help with anything please contact support.
Darren Hawkins, MSTA
Senior Software Specialist at Optuma
Darren is the senior Software Specialist at Optuma. He joined the company in 2009 after attending an introductory technical analysis course. Darren now instructs users all over the world, from experienced Wall Street traders and professional money managers to individual traders drawing their first trendlines.
Darren grew up in the UK and attended college in the USA where he earned a BA in Economics from St Mary's College of Maryland. He went on to spend a few years working at the Nasdaq Stock Market in Washington DC. Going on to live and work in Australia, the US and currently the UK, Darren has a broad understanding of the individual needs of traders, portfolio managers and investors utilising a wide range of methodologies.
In 2014 Darren passed the UK-based Society of Technical Analysts diploma course, and when not looking at charts he keeps a keen eye on England's cricket team - especially if they are playing against Australia. He lives in the Essex countryside in England, with wife Wendy and their labrador, Gabba.