Despite slowing the asset inflows over February, especially in the last weeks on the heels of rising volatility, global equity exchange traded funds recorded their strongest two-month start ever to a new year.
Globally, developed market equity exchange traded products, which included both ETFs and exchange traded notes, saw $13 billion in new inflows, including a $7.3 billion in non-U.S. exposure, according to a BlackRock report. [Here are the Most-Searched ETFs]
Sector funds gathered $4.7 billion, with real estate leading at $1.5 billion as economic indicators pointed to a rebounding U.S. housing market. Emerging market equity ETP inflows slowed. Additionally, Dividend-focused ETPs added $1.6 billion. [ETF Performance Report: February]
Minimum- or low-volatility ETFs also saw heavier inflows, attracting an average $926 million for the firs two months, or double the monthly flows over 2012.
Investors are also taking a more cautious approach to interest rate risk, moving to the short-term fixed-income yield curve. Short-term debt ETPs saw $4 billion in new inflows while other maturities experienced outflows of $1.3 billion.