As a whole, 2013 so far has been a big year for exchange-traded
and ETNs broke through the $1.5 trillion mark in overall assets,
adding $83.4 billion-a 5.44 percent gain-in the first 4 1/2 months
of the year alone according to data compiled by IndexUniverse.
While the entire exchange-traded-product universe is enjoying
overall gains, assets under management are really coming up roses
for a select handful of ETFs. In terms of overall inflows
year-to-date, the table below lists the 10 funds that have
Top Gainers ($, Billions)
||Flows ($, B)
||AUM ($, B)
||WisdomTree Japan Hedged Equity
||iShares MSCI Japan
||iShares Core S&P 500
||Vanguard Short-Term Bond
||PowerShares Senior Loan
||Vanguard Total Stock Market
||iShares MSCI USA Minimum Volatility
||Vanguard Dividend Appreciation
||iShares Russell 2000
Japan Is (Still) The Word
The biggest gainer year-to-date is WisdomTree's Japan Hedged
Equity fund (NYSEArca:DXJ), which has heaped on $6.72 billion since
the first of the year, increasing its AUM by an incredible 70
The iShares MSCI Japan ETF (NYSEArca:EWJ) is runner-up to DXJ,
piling on $5.10 billion. These funds' success are wholly
attributable to Japanese Prime Minister Shinzo Abe's aggressive
monetary easing policies that have been effective at pushing the
yen downward and in turn lifting the Japanese stock market as
exports become cheaper.
DXJ is a newer, smaller fund than EWJ, but its superior
popularity can be traced to a more intuitive investment strategy.
While DXJ hedges against the yen-dollar cross, EWJ does not,
leaving investors exposed to the nasty bite of a currency that has
slid to more than 100 yen per dollar, year-to-date.
While 'Abenomics' sweetened investments abroad, rallying
domestic stock markets drove billions into U.S. equity funds.
It's no surprise that the iShares Core S&P 500 ETF
(NYSEArca:IVV), which added $2.91 billion so far this year, is the
largest gainer of U.S. equity funds. After all, the S&P 500 has
increased 16.27 percent since its year-end close on Dec. 31, 2012,
closing at a record of 1,658.78 on May 15.
What does come as somewhat of a surprise is that IVV's large-cap
brother, and grandfather of ETFs-the SPDR S&P 500 ETF
(NYSEArca:SPY)-doesn't land on the list of top gainers. In fact,
SPY has dropped $604 million year-to-date.
Both funds are weighted similarly, and base their holdings on
the S&P 500. Perhaps IVV's lower cost-7 basis points compared
with SPY's 9-motivated investors to make the move.
The other U.S. equity funds among the year's best so far are
Vanguard's Total Stock Market ETF (NYSEArca:VTI), with inflows of
$2.54 billion, and the iShares Russell 2000 fund (NYSEArca:IWM),
which gathered $1.93 billion.
With markets rallying to record-highs, it comes as a bit of a
curveball that the eighth-place gainer is iShares' MSCI USA Minimum
Volatility fund (NYSEArca:USMV). The fund has scooped up $2.51
billion year to date, making for a staggering 70 percent AUM
BlackRock's iShares funds account for four of the 10 biggest
gainers, and the issuer itself has barreled forward with asset
accumulation, shattering and surpassing the $600 billion mark
earlier this year.
In USMV, iShares created a tool to manage the volatile U.S.
equity markets. It's not in spite of, but rather because of, the
market's awesome performance that funds like USMV have garnered
investor interest. After all, what goes up must come down,and when
markets rebound, an investment in USMV will prove wise.
A Few Surprises
The Vanguard Short-Term Bond fund (NYSEArca:BSV) grew 23.5
percent, adding $2.86 billion and reaping the benefits of the Fed's
downward pressure on interest rates. BSV holds one- to five-year
Treasury debt, and as interest rates reach dirt-cheap lows, bonds
less distant along the yield curve become exponentially more
attractive than longer-term, less stable debt.
Vanguard's REIT ETF (NYSEArca:VNQ) scooped up $2.54 billion, and
the Vanguard Dividend Appreciation fund (NYSEArca:VIG) added $1.94
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