Related: ETF Performance Report – July 2017
Overall, most of the money has flowed into bond ETFs, notably corporate debt, as fixed-income investors sought attractive yield-generating assets in a stubbornly low yielding environment. More investors are also seeking riskier bets to fuel trades in stretched market conditions.
“Investors are bored,” Dave Nadig, head of ETF.com, told CNBC. “The S&P is up over 9 percent this year, but the VIX is at 9, so investors are chasing emerging markets, and the junkier end of the bond spectrum.”
With valuations looking pricey in U.S. equities, many ETF investors have also shifted their attention toward relatively cheaper markets, like emerging markets and Europe. The shift in flows may reflect investors changing sentiment on Europe and EM markets after investors yanked billions out of related equity ETPs globally last year. Consequently, cash that may have been sitting on the side is finally being put to work.
For more information on the ETF industry, visit our ETF performance reports category.