As Investors Dump Domestic Funds, EAFE Funds Assets Gather Steam
Analyst Paul Weisbruch of Street One Financial in his daily fund flows update points out continued outflows from the largest U.S.-focused index funds, and contrasting inflows into foreign-based ETFs.
Exodus From Domestic Equities Continues
The largest broad based index ETFs like SPY (-$3.8 billion), IWM (-$1.8 billion), and QQQ (-$1.5 billion) have seen substantial outflows in the past twentyfour hours or so even with the markets rallying to new all-time highs. The SPX briefly got above 2300 in early trading this morning before retreating a bit, and it seems that some are using this most recent rally as an opportunity to take profits.
Foreign Funds Attracting Inflows
In other activity, EAFE funds from iShares, IEFA (iShares Core MSCI EAFE) and EFV (iShares MSCI EAFE Value) have pulled in nice amounts lately, gaining over $700 million and $400 million apiece, respectively. ETF/Index options trading remains rather uneventful however this week, something that we mentioned during the past couple days with a $10 handle on the VIX.
The iShares Core MSCI EAFE ETF (NYSE:IEFA) was trading at $55.82 per share on Thursday morning, down $0.23 (-0.41%). Year-to-date, IEFA has gained 4.08%, versus a 2.65% rise in the benchmark S&P 500 index during the same period.
IEFA currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #2 of 49 ETFs in the Foreign Large Cap Blend ETFs category.
Disclaimer: The content of this article is excerpted from a daily newsletter from Street One Financial. While ETF Daily News may edit the contents and add a relevant title to the piece, the author, Paul Weisbruch, does not endorse or recommend any issuer or security mentioned herein.
Paul Weisbruch is the VP of ETF/Options Sales and Trading at Street One Financial. Prior to joining the team at Street One, Paul served as the Director of RIA and Institutional ETF Sales at RevenueShares ETFs from December 2007 until November of 2009. Before RevenueShares, Paul was employed by Susquehanna International Group from 2000 until 2007 serving in roles including OTC/NYSE Institutional Block Trading, Nasdaq/OTC Market Making, ETF/Derivatives Intelligence and Strategy, Algorithmic Trading, as well as acting as the PHLX Floor Specialist in the ETFs, SPY and DIA.Paul has been actively involved in the ETF space from both a product and trading standpoint since 2000. Additionally, Paul has well forged relationships with national RIAs, institutional pension fund managers and consultants, mutual fund and hedge fund managers, and also the ETF media. Co-authoring the “S1F ETF Daily” since 2009, the daily piece has become a must for many portfolio managers in the ETF space, with segments regularly appearing in the likes of Barron’s, WSJ, and ETFTrends.com for instance.
He holds his Series 4 (Registered Options Principal), 6, 7, 55 (Equity Trader), 63, and 65 licenses. He graduated from the University of Pittsburgh (B.S. – Economics), graduating magna cum laude, and has an MBA from Villanova University.
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