July was an impressive asset-gathering month for ETFs. Much of the heavy lifting was done by the industry’s largest ETFs. For example, the iShares Core S&P 500 ETF (IVV) sucked up $11 billion, the Vanguard S&P 500 ETF (VOO) pulled in $3.9 billion, the Invesco QQQ Trust (QQQ) added $3.7 billion, and the iShares Core U.S. Aggregate Bond ETF (AGG) soaked up $2.2 billion. However, what excites me is seeing under-the-radar ETFs gain ground.
In April, VettaFi acquired the LOGICLY platform. LOGICLY is a leading web-based platform that allows financial advisors and asset managers to streamline the investment research process and access comprehensive portfolio management capabilities, real-time alerts, and advanced analytics. I discovered that one of the features is the ability to easily see what ETFs had a high percentage of net inflows relative to assets over a short period of time. This was so much fun that I came back again using May data, and now again two months later.
Looking to Emerging Markets for Income
The JPMorgan USD Emerging Markets Sovereign Bond ETF (JPMB) is a five-and-a-half-year-old international fixed income ETF. On July 31, JPMB pulled in $293 million. Though we are focused on July, an additional $104 million came into JPMB on August 1. The combined flows pushed JPMB’s assets above $550 million. The ETF recently offered a 6.5% 30-day SEC yield through sovereign and quasi-sovereign bonds from emerging markets.
Brazil, Columbia, the Dominican Republic, Oman, South Africa, and Turkey were among the largest countries the ETF had exposure to. JPMB’s index-based approach filters for country risk and liquidity. JPMB is a peer of the iShares JPMorgan USD Emerging Markets Bond ETF (EMB), which pulled in $1.4 billion in July.
A Global X Smart Beta ETF Finds a Following
The Global X Adaptive U.S. Factor ETF (AUSF) will turn five years old this month. On July 31, the smart beta ETF added $160 million to nearly double its assets to $340 million. AUSF allocates across three factors — minimum volatility, value, and momentum — that have historically performed well. With the August rebalance, AUSF was evenly split between low volatility and momentum but can have exposure to just two of the three factors.
Arthur J Gallagher, Broadcom, Eli Lilly, General Electric, and NVIDIA were among the fund’s recent top 10 positions. Such diversity showcases the blending of the two factors.
