Exchange traded fund investors have been dumping exposure to U.S. equities in favor of overseas markets this year.
According to Lipper data, the SPDR S&P 500 ETF (NYSEArca: SPY) experienced the largest amount of redemptions in 2015 of any one portfolio, bleeding $46.5 billion in the second quarter, reports Stephanie Yang for CNBC.
Meanwhile, investors have been funneling $50.5 billion into developed international market funds, notably those that track European markets.
Year-to-date, SPY has experienced $42.6 billion in net outflows, according to ETF.com. In contrast, the WisdomTree Europe Hedged Equity Fund (NYSEArca: HEDJ) and Deutsche X-trackers MSCI EAFE Hedged Equity ETF (NYSEArca: DBEF) are the two most popular ETFs of the year, attracting about $15.4 billion and $12.0 billion in net inflows.
The currency-hedged ETF strategies have been up-and-coming plays to garner international market exposure while mitigating risks associated with depreciating overseas currencies or a stronger U.S. dollar.
The recent market weakness has also triggered an exodus from U.S. markets. Over the past week, SPY lost $1.1 billion, PowerShares QQQ (NasdaqGM: QQQ) saw $1.2 billion in outflows and iShares Russell 2000 ETF (NYSEArca: IWM) saaw $737.1 million in redemptions.