U.S.-listed ETP assets grew to $1.078 trillion at the end of March, according to the latest data from the National Stock Exchange, putting the cap on another solid quarter of growth for the industry. Cash inflows in March totaled $11.2 billion, a material increase from $7.4 billion the month before. That figure could have been far more impressive if not for more than $5 billion in outflows from the S&P 500 SPDR (SPY), which remains the largest U.S.-listed ETF with almost $90 billion in assets.
SPY’s losses were enough to put U.S. equities in the red for the month. Outflows from that asset class totaled $3.1 billion. International equity ETFs more than made up for those outflows, however, by taking in close to $7.4 billion. Fixed income ETFs saw $2.6 billion in inflows while commodity ETPs took in $2.1 billion.
In addition to SPY, four other ETFs saw outflows of $500 million or more in March. The iShares S&P 500 Index Fund (IVV) bled $1.1 billion, the PowerShares QQQ lost $830 million, the Dow Jones Industrial Average ETF (DIA) lost $695 million, and the MidCap SPDR (MDY) lost $578 million. Seven ETFs took in more than $500 million on the month, including:
- iShares MSCI Japan Index Fund (EWJ): $1.7 billion
- Vanguard MSCI Emerging Markets ETF (VWO): $1.6 billion
- iShares Russell 2000 Index Fund (IWM): $976 million
- iShares FTSE China 25 Index Fund (FXI): $721 million
- iShares MSCI Canada (EWC): $678
- iShares MSCI EAFE Index Fund (EFA): $573 million
- Market Vectors Russia ETF (RSX): $573 million
Cash inflows into Japanese equity ETFs were strong across the board. The seven products in the Japan Equities ETFdb Category all saw net inflows on the month, taking in close to $2.2 billion in aggregate. Leveraged Japan ETFs also saw big inflows. The ProShares UltraShort MSCI Japan (EWV) took in $46 million, or more than 400% of total assets at the end of February. The long counterpart, EZJ, saw inflows equivalent of nearly 300% of February AUM.
In the closely watched battle between emerging markets ETFs, Vanguard’s VWO struck another blow in March. That fund took in $1.6 billion while the iShares MSCI Emerging Markets Index Fund (EEM) saw $82 million in outflows. For the first quarter VWO tallied inflows of $1.9 billion while nearly $9.3 billion flowed out of EEM. Both funds seek to replicate the MSCI Emerging Markets Index, but VWO has a significant cost advantage, charging just 22 basis points compared to 0.69% for EEM. The decline in EEM’s assets since the beginning of 2011 translates into a loss of about $61 million in management fees annually for iShares.
In another head-to-head match-up of ETFs differentiated primarily by expenses, the iShares COMEX Gold Trust (IAU) continues to gain ground on the Gold SPDR (GLD). IAU saw $310 million in inflows last month compared to just $25 million for GLD. Both products offer exposure to gold bullion, but IAU charges 25 basis points while GLD comes in at 0.40%.
iShares Back on Top
iShares led all issuers in inflows for March, taking in $5.9 billion. Vanguard was next with $3.7 billion, followed by ProShares ($980 million) and WisdomTree ($724 million). Several smaller players continued to make huge strides during the month. PIMCO took in more than $530 million, equal to nearly a quarter of total AUM just a month before. ALPS saw inflows of more than $170 million, 17% of February assets. And Global X raked in another $200 million, which represents about 14% of the issuer’s total assets just a month before.
Vanguard was the top gainer for the first quarter, taking in more than $10 billion in new assets.
Disclosure: No positions at time of writing.
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