Exchange-traded funds in November had their third biggest asset inflow in the product’s two-decade history, according to a new report from ETF.com.
Investors allocated $42 billion to ETFs last month, most of it into equities, bringing the year’s asset gathering to some $192 billion—ahead of last year’s record $188 billion.
November’s monthly inflow was exceeded only in September 2008 and December 2007.
The mid-September to mid-October pullback in financial markets caused by growth concerns in the Eurozone, Japan and China has segued to a focus on the relatively healthy U.S. economy.
The S&P 500 Index rose by more than 2% in November, which along with the huge inflows helped lift total U.S.-listed ETF assets to just shy of a record $2 trillion, according to data compiled by ETF.com.
This compares with $3 trillion for hedge funds and some $15 trillion for open-end mutual funds.
ETF.com reported that SPDR S&P 500 ETF brought in more than $10 billion in fresh assets last month, making it the single most popular fund. U.S. equities in total pulled in nearly $33 billion.
International equities attracted almost $8 billion in November. Two WisdomTree currency-hedged strategies accounted for nearly a third of those flows.
WisdomTree Japan Hedged Equity Fund added $1.3 billion in new assets, bringing its month-end total to $12.6 billion, while WisdomTree Europe Hedged Equity Fund pulled in $1.2 billion, raising its total to $4.6 billion.
At a time when bond flows have been volatile, November’s least-popular fund was iShares 1-3 Year Treasury Bond ETF, which gave up more than a quarter of its assets, $3.5 billion.
SPDR Gold Shares, the world’s biggest gold bullion ETF, hemorrhaged $870 million last month—quite a comedown from August 2011 when it was the world’s biggest ETF amid global anxiety following Standard & Poor’s unprecedented downgrade of U.S. debt and signs the Eurozone’s economic challenges were deepening.
Since then, strength in equity markets and an absence of inflationary pressure have hurt gold prices and the popularity of ETFs such as this fund.