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Risk on, dude: investors are ready to rotate, November fund flow data show


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How to characterize exchange-traded fund flows in November? As
Wayne might have said, “Risk ON, Garth.”

Investors poured $91.6 billion of new money into ETFs during the month, according to data provided to MarketWatch by Refinitiv Lipper. Equity ETFs picked up the vast majority of that, $81.2 billion, followed by bond ETFs, with $14.5 billion.

But the real story lies within Refinitiv Lipper’s sub-classifications. S&P 500 Index funds picked up the most money, followed by Small-cap Core funds.

ETF Classification

Inflows

S&P 500 Index funds

$1.82 billion

Small-Cap Core funds

$6.15 billion

Multi-Cap Core funds

$5.79 billion

Large-Cap Core funds

$5.65 billion

High-Yield funds

$4.36 billion

Financial Services funds

$3.5 billion

International Multi-Cap Core funds

$3.49 billion

Science & Technology funds

$3.33 billion

Large-Cap Value funds

$3.29 billion

Multi-Cap Value funds

$3.18 billion

Source: Refinitiv Lipper

In fact, it was the best month for small-caps since the last presidential election, November 2016, and a reversal from the top-heavy flows of the past year, said Tom Roseen, head of research services for Refinitiv Lipper.

“Investors are looking for yield and willing to put on risk,” Roseen told MarketWatch.

The fifth-biggest category gainer was High-yield funds, while U.S. Treasury funds saw the biggest outflows, followed by Commodities Precious metals funds.

“One month is not proof of anything but there’s been a change in investor sentiment,” Roseen said. It looks set to be the start of what he thinks could be a “solid” rotation into financials and other cyclical stocks.

See: These are the ETFs to help you prepare for a Biden presidency

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