Economic Charts

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Wednesday, September 29, 2010

Monthly ETF Money Flows

Augusts ETF money flows report was out which showed money leaving the ETF market as a whole.  This is consistent with what is occurring in the mutual fund market, but the Mutual Fund market getting hit with outflows in the billions month over month (refer to Weekly Fund Flows Update), which adds to the story that the main thing feeding this monster seems to be the FED and its Primary Dealers (also referred to as the Plunge Protection Team).

A breakdown of what type of ETF is experiencing the largest outflow reveals large cap stocks are seeing the largest exodus.  Overall Large Cap, Mid Cap and Small Cap ETFs are experiencing negative money flows (i.e. money is being taken out).  Other ETF types experiencing negative flows were; Consumer, financial, health, Natural Resources and technology.  The big winner seemed to be Emerging Markets and corporate Bonds (no surprise there), with bonds experiencing a positive flow of money across the board.
This seems very concerning for the markets and we will have to continue to monitor the trend in ETF money flows.

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