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3 Large-Cap ETFs With Solid Inflows in March


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Wall Street has been recovering lately as fears of aggressive rate hikes abate. Positive jobs data but tepid wage growth reduced fears of frequent rate hikes by the Fed (read: 3 ETFs to Benefit as Faster Rate Hike Worries Cool Down ).

What's Driving Inflows?

The U.S. economy added 313,000 jobs in February - the highest since July 2016 - compared with a Reuters forecast of 200,000. However, tepid wage growth reduced fears of the Fed going on a rate hike spree. Average hourly earnings in the United States grew a mere 0.1% in February compared with 0.3% in the previous month (read: 6 Sector ETFs to Win on Strong February Job Data ).

In February, the S&P 500 entered correction territory and lost more than 10% as strong wage growth in January made investors bet on aggressive rate hikes by the Fed. However, the recent weakness in wage growth has introduced some calm with respect to faster-than-expected rate hikes.

U.S. large-cap ETFs have been garnering record inflows in March as multiple factors are reducing investor worries. There is slight relief as far as geopolitical risks are concerned. North Korea has expressed its intent to commence denuclearization talks in case security for its regime is guaranteed. Although there is still a lot of uncertainty surrounding this, the talks are a step in the right direction and President Trump has agreed to meet with his North Korean counterpart.  

Moreover, March has witnessed massive outflows from high risk assets as Trump sparked fears of a trade war by imposing a 25% tariff on steel imports and a 10% tariff on aluminum imports. Multiple nations have already declared potential retaliatory measures. Although equities, as a whole, had to bear the brunt of Trump's protectionist policy, large-cap ETFs exhibit low volatility and are thus less prone to huge market swings.

Let us now discuss three ETFs, which witnessed massive inflows in March so far.

iShares Core S&P 500 ETF IVV

This fund is a low-cost ETF that seeks to provide exposure to large established U.S. companies and tracks the S&P 500 Index. This fund amassed $956.0 million in inflows in the period Mar 1- Mar 12, per etf.com data .  

It has AUM of $160.0 billion and charges a fee of 4 basis points a year. From a sector look, the fund has high exposure to Information Technology, Financials and Health Care with 25.2%, 15.0% and 13.7% allocation, respectively. The fund's top three holdings are Apple Inc AAPL , Microsoft Corporation MSFT and Amazon.com Inc AMZN with 3.9%, 3.1% and 2.6% allocation, respectively. The fund has returned 19.6% in a year. It has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.

Vanguard S&P 500 ETF VOO

This fund is a popular ETF targeting large-cap U.S. companies and tracks the S&P 500 Index. This fund amassed $665.8 million in inflows in the period Mar 1- Mar 12, per etf.com data.  

It has AUM of $92.4 billion and charges a fee of 4 basis points a year. From a sector look, the fund has high exposure to Consumer Discretionary, Consumer Staples and Energy with 12.6%, 7.9% and 6.0% allocation, respectively. The fund's top three holdings are Apple, Microsoft and Alphabet GOOGL with 3.6%, 3.0% and 2.9% allocation, respectively. The fund has returned 19.6% in a year. It has a Zacks ETF Rank #3 with a Medium risk outlook.

Vanguard Large Cap ETF VV

This fund is a popular ETF targeting large-cap U.S. companies and tracks the CRSP US Large Cap Index. This fund amassed $183.5 million in inflows in the period Mar 1- Mar 12, per etf.com data.  

It has AUM of $12.4 billion and charges a fee of 6 basis points a year. From a sector look, the fund has high exposure to Information Technology, Financials and Consumer Services with 20.1%, 19.7% and 13.5% allocation, respectively. The fund's top three holdings are Apple, Microsoft and Alphabet with 3.1%, 3.0% and 2.8% allocation, respectively. The fund has returned 19.8% in a year. It has a Zacks ETF Rank #3 with a Medium risk outlook.

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ISHARS-SP500 (IVV): ETF Research Reports

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.



This article appears in: Investing , ETFs
Referenced Symbols: AMZN , GOOGL , AAPL , MSFT , VV



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