August ETF Flows: Sectors See Rotation by Dave Nadig, Director of Exchange Traded Funds – FactSet

Flows are out for August, and while flows were strong at $28.5 billion (the second highest flows for the year) August’s late summer doldrums were still a marked drop from July’s $52 billion high.

August’s big story is sector rotation. Financials and energy came back from a dismal July to top August’s inflows at $1.4 billion and $1.1 billion. Technology saw its first positive month since April. Telecommunications meanwhile shifted into the red for the first time this year. The $312 million loss was the sector’s first negative outflow since September 2015.

ETF Flows

ETF Flows

Emerging Markets equities saw strong flows this month, topping even US Large Caps. The segment saw inflows of $4.9 billion with iShares MSCI Emerging Markets ETF as this month’s market leader with $2.2 billion new assets.

Winners and Losers

While still topping the charts for YTD flows at almost $12 billion, SPDR Gold Trust, saw $613 million in outflows this August. Gold’s retreat saw a net $280 million pulled from the segment, leading to the first negative flows for commodities since April.

ETF Flows

August was another dismal month for WisdomTree, as the issuer lost a further $1.7 billion in assets as the bleeding continued in currency-hedged funds. Its star funds, WisdomTree Japan Hedged Equity Fund and WisdomTree Europe Hedged Equity Fund both made the top ten for this month’s biggest outflows with losses of $1.1 billion and $551 million respectively.

ETF Flows

Strong flows this month have put the industry firmly on track to match last year.

Related: July ETF Flows: Full Speed Ahead

In summary, August continued last month’s classic “risk on” trend, with strong flows throughout equities and fixed income, domestic and international.

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