U.S. markets were destabilized in August after pushing toward record highs as a bout of political risks abroad and at home caused many traders to sell and lock in recent gains. Meanwhile, exchange traded fund seemed to have viewed the recently selling as a short-term event, funneling billions back into to big, stable equity plays.
The SPDR S&P 500 ETF (NYSEARCA: SPY) remained the most popular play over August, attracting $3.7 billion in net inflows, according to XTF data. The popular S&P 500 ETF play has been a go-to for institutional-level investors seeking to quickly go in and out of the market as SPY has consistently shown low bid-ask spreads, even in face of high volume trades.
Along the same lines, the iShares Russell 2000 ETF (NYSEArca: IWM) saw $2.6 billion in net inflows, Vanguard FTSE Developed Markets ETF (NYSEArca: VEA) brought in $1.8 billion, SPDR Dow Jones Industrial Average ETF (NYSEArca: DIA) added $1.1 billion, PowerShares QQQ (NasdaqGM: QQQ) attracted $1.0 billion and Vanguard FTSE Emerging Markets ETF (NYSEArca: VWO) experienced $853 million in inflows over August. These ETFs are among the most popular plays in their respective asset categories.
The broad iShares Core U.S. Aggregate Bond ETF (NYSEArca: AGG) was the only popular fixed-income play that ranked among the top 10 over August, bringing in $1.1 billion in new money.