Investors Are Dumping SPY, Despite The S&P 500 Soaring To New Highs

Analyst Paul Weisbruch of Street One Financial in his daily fund flows update points out some interesting action in the world’s largest ETF, which is seeing sizable outflows as of late, despite surging to fresh all-time highs.

ETF/Index options flow, even post last week’s January options expiration, has mostly consisted of closing put sellers in some broad based index products. This action is reflective of portfolio managers adjusting hedges into these new market highs, where seemingly any small dip in equities has been bought.

On the same wavelength, we have not seen a ton of interest in upside calls in any size to note either, so we are lacking in terms of having a ton of pivotal specific activity to speak about today in this piece. In addition to slower trading in the ETF/Index options markets, ETF and stock underlying volumes have been muted to average as well this week, as evidenced in SPY for example, only trading above average volume in only two of the past fifteen trading sessions.

Interestingly, SPY outflows have been building this week, with a significant over $6.5 billion leaving the fund via redemption flows — although the underlying index continues to rally.

The SPDR S&P 500 ETF Trust (NYSE:SPY) was trading at $228.89 per share on Wednesday morning, up $1.29 (+0.57%). Year-to-date, SPY has gained 2.40%, 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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