Cinthia Murphy, investment strategist at VettaFi, joined Nate Geraci on this week’s ETF Prime to discuss record ETF flows in the first quarter despite challenging market conditions. The industry exceeded $460 billion in total flows, a 50% year-over-year increase from Q1 2025, according to Murphy.
- ETF industry posted record $460 billion in Q1 2026 flows, a 50% increase over the prior year despite market volatility.
- SPDR Portfolio S&P 500 ETF topped the leaderboard with $26 billion, beating Vanguard’s VOO on fee sensitivity.
- Fixed income captured 45% of March flows as investors shifted to defensive positions amid Iran conflict.
January and February saw strong momentum with $170 billion and $190 billion in inflows respectively, before decelerating to over $100 billion in March, Murphy said. The S&P 500 fell over 4% in the first quarter while the Nasdaq 100 dropped 6%, yet investors continued allocating to ETFs rather than retreating from them.
In a surprising development, the State Street SPDR Portfolio S&P 500 ETF (SPYM) captured the top spot on the quarterly leaderboard with $26 billion in inflows, edging out the Vanguard S&P 500 ETF (VOO ) at $22 billion. Murphy attributed SPM’s momentum to its 2 basis point fee, noting that fee sensitivity matters especially in defensive markets. The fund has now crossed $120 billion in assets, joining an elite club of only 19 ETFs above $100 billion.
Defensive Shift Accelerates
The ProShares Genius Money Market ETF (IQMM) ranked third with nearly $22 billion in inflows. The fund is built around regulatory requirements for stablecoin reserves under the Genius Act, Murphy said. Fixed income dominated March flows, accounting for 45% of total inflows as investors flocked to cash-like vehicles including the iShares 0-3 Month Treasury Bond ETF (SGOV ) and the State Street SPDR Bloomberg 1-3 Month T-Bill ETF (BIL ) amid Iran war volatility, she added.
See more: Money Market ETF Hits $22 Billion in Record Launch
Murphy noted the return of diversification as international equity ETFs like the iShares Core MSCI Emerging Markets ETF (IEMG ) and the Vanguard Total International Stock ETF (VXUS ) posted strong gains. However, March saw international stocks decline 8% while domestic equities held up better, she said.
Troy Cates, co-founder and managing partner of NEOS Investments, discussed the firm’s explosive growth to over $22 billion across 19 ETFs in less than four years. The NEOS S&P 500 High Income ETF (SPYI ) and the NEOS Nasdaq 100 High Income ETF (QQQI ) each hold over $8 billion in assets. NEOS writes out-of-the-money calls on approximately 50% of notional value to generate income while preserving upside participation, Cates said.
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