Expect Big Inflows Back Into SPY, Now That Equities Are Surging Again

Analyst Paul Weisbruch of Street One Financial brings us his daily fund flows report, which focuses on today’s massive equity rally and its implications for the world’s largest ETF, along with the accompanying plunge in volatility.

As we mentioned previously, there was some position trimming in SPY last week topping $2.5 billion leaving the fund via redemption pressure, and we expect turnover in the general markets and ETFs in particular to increase this week given the big futures rally in Europe following French election results and the fact that we are steeped in core quarterly corporate earnings season.

Today’s rally, if it holds, takes us roughly 25 points from all-time highs in the SPX, and the Nasdaq Composite is trading at new highs already this morning. This quick move higher will certainly reel in trading interest this week, not to mention heading into the end of month, with May trading beginning next Monday.

As equities surge, the VIX is down a stunning 18% today, and is suddenly back below a $12 handle after spending a couple weeks in the $13-$16 range after French election results. Popular VIX-linked ETP VXX may resultingly challenge new all-time lows again this week, which were last registered in late March.

The SPDR S&P 500 ETF Trust (NYSE:SPY) was trading at $237.02 per share on Monday morning, up $2.43 (+1.04%). Year-to-date, SPY has gained 6.03%, versus a % rise in the benchmark S&P 500 index during the same period.

SPY currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #1 of 108 ETFs in the 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.

About the Author: Paul Weisbruch

paul-weisbruchPaul 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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