The expansion of the ETF industry over the last several years has been truly impressive, as the product lineup has grown to more than 1,200 exchange-traded products and assets have passed the $1 trillion mark. But May marked a small step backwards, as ETF assets dipped slightly as a result of both weak equity market performance and net outflows. According to the latest data from the National Stock Exchange, ETF assets stood at $1.11 trillion at the end of May, down about 2% from the April total.
While steady declines in global equity markets contributed to the May swoon, last month also saw net outflows from ETPs for the first time in 2011; after April saw more than $22 billion in inflows, about $978 million went out the door in the month of May. But excluding the largest ETF on the market, May actually saw inflows of about $4 billion; the S&P 500 SPDR (SPY) saw outflows of $4.9 billion in May, and finished the month with about $89 billion in AUM.
Excluding SPY, U.S. equity ETFs saw net inflows in May, while international funds bled about $1.2 billion. Commodity products also saw big outflows of about $3.9 billion, while fixed income ETFs benefited from a flight to safe havens. Bond ETFs saw about $4.7 billion in inflows last month. Treasuries in particular were popular in May; $1.3 billion flowed into the Government Bonds ETFdb Category, with another $878 million going into Corporate Bonds ETFdb Category and Total Bond Market ETFdb Category.
Amidst a broad exit out of commodities, precious metals fell out of favor with investors in May. The Precious Metals ETFdb Category saw aggregate outflows on the month of $2.7 billion
Big Winners: Vanguard, Van Eck
Vanguard led all issuers in inflows last month, taking in another $7 billion in creations to bring the year-to-date total to more than $20 billion. Blackrock ($1.9 billion), PowerShares ($2.2 billion), and State Street ($6.0 billion) all saw May outflows. Van Eck also saw strong inflows on the month of about $985 million, and ProShares ($730 million) and WisdomTree ($393 million) were among the other big winners.
Including SPY, five of the seven largest ETFs by total assets saw big outflows in May. Those included the Gold SPDR (GLD, $906 million), iShares MSCI Emerging Markets Index Fund (EEM, $317), iShares S&P 500 Index Fund (IVV, $391 million), and PowerShares QQQ (QQQ, $2.5 billion). Two other ETFs saw more than $1 billion go out the door in May: the iShares Russell 2000 Index Fund (IWM) and iShares Silver Trust (SLV) saw outflows of $2.1 billion and $1.4 billion, respectively. One bright spot for Blackrock was the iShares COMEX Gold Trust (IAU), which continues to gain ground on its more expensive competitor, GLD. The gap between the two physical gold funds has narrowed by about $7 billion over the last year [see For ETF Investors, Details Matter].
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Disclosure: No positions at time of writing.