Some exchange traded products beyond run-of-the-mill fare have also seen significant inflows in the current quarter.
“Levered/inverse products, which generally replicate one-day returns, are up some $4.7 billion year-to-date and $1.1 billion in the quarter. That may not sound like a lot, but the total AUM here is just $42 billion for all levered/inverse products and the YTD growth is therefore +10%. On the volatility side, with products that track the CBOE VIX Index for example, AUM is $3.1 billion and YTD money flows are $1.3 billion. The quarter to date number is $557.7 million. Both represent sizable, novel and immediate interest in what is still largely a niche set of offerings,” said Colas.
For example, the iPath S&P 500 VIX Short Term Futures ETN (NYSEArca: VXX) has added $253 million this quarter. Investors have also been making leveraged bets on select broad market indices and sectors. Although gold prices have been sliding, the Direxion Daily Gold Miners Bull 3X Shares (NYSEArca: NUGT) is heavier by $188 million this quarter. [Getting it Wrong Leveraged Gold ETFs]
As highlighted by the $114 million of inflows to the Direxion Daily Small Cap Bull 3X Shares (NYSEArca: TNA), some traders are waiting on a small-cap rebound, but that number coincides with almost $60 million added to the ProShares UltraPro Short QQQ (NasdaqGS: SQQQ).
SPDR S&P 500 ETF
Tom Lydon’s clients own shares of SPY.