The market strategists at ConvergEx Group take a look at YTD ETF inflows at the halfway mark through Q1. And while I don’t want to upset everyone who screamed that “it’s not a rotation!” til they were blue in the face, I would like to share some stats with you…
As a reminder – flows to the $1.4 trillion ETF complex are a lot more important to track than traditional mutual fund flows data from ICI that everyone else references. This is because ETFs represent the fresh cash, cash leaving mutual funds, younger investors and non-retirement plan assets (which traditionally do not give contributors access to ETFs). In essence, ETF flows represent the “free will” of the flexible investor class.
OK, some stats:
* Of the $37.5 billion in ETF inflows year-to-date through Friday, “$34.4 billion (92%) went into stock funds, more than the customary 65-70% mix of the last few years.”
* Within this asset class, U.S. stocks garnered the largest share, $14.6 billion, or 42% of all equity flows.
* Fixed income ETFs “are essentially at a standstill so far in 2013 – only $1.1 billion in new money – with sovereign debt funds losing $1.1 billion in redemptions since January 1st” You should know that by sovereign they mean treasury bond funds, papi.
But please, whatever you do – DO NOT CALL IT A ROTATION! Too many pundits have too much invested against this idea now that they’ve shot their mouths off in public prior to waiting for the data.