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November ETF Asset Report: Short-Term Bonds Top

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Given how important November was with midterms producing a divided congress in the United States, a steep slump in oil prices, solid online retail sales during Thanksgiving and Black Friday and the progress in Brexit talks, it will be interesting to look back at how ETF investors behaved in the month.

Let’s take a look at the corners that were the hot favorites of investors and those that were cast out.

S&P 500 Rules

Since the U.S. market held ground in the month and the S&P 500 performed well, SPDR S&P 500 ETF (SPY - Free Report) topped the list with about $5.81 billion of monthly inflow.

Short-Term Bonds Prevail

Investors should note that yield on short-term Treasury bills outdoes U.S. inflation, meaning investors can now have real, inflation-adjusted return from cash for the first time in a decade, per Financial Times. Short-term bonds also have low interest rate sensitivity than the longer-term ones.

iShares 1-3 Year Treasury Bond ETF (SHY - Free Report) , SPDR Bloomberg Barclays 1-3 Month T-Bill ETF (BIL - Free Report) , iShares Short Treasury Bond ETF (SHV - Free Report) , JPMorgan Ultra-Short Income ETF (JPST - Free Report) and Vanguard Short-Term Treasury Index ETF (VGSH - Free Report) attracted about $2.45 billion, $1.74 billion, $1.72 billion, $1.05 billion and $1.05 billion, respectively.

Minimum Volatility ETF Gains Too

Since there were host of worries in the market in November, including higher interest rates, collapse in oil prices, concerns over trade war and its resultant threat to the global economy, cautious investors piled up their assets in minimum volatility ETFs. iShares Edge MSCI Min Vol U.S.A. ETF (USMV - Free Report) raked in about $1.9 billion in assets (read: Nervous Investors Pile Into Low Volatility, Defensive ETFs).

Emerging Markets Back to Investors’ Favor

Cheaper valuation and a subdued greenback led to renewed interests in investors about investing in emerging markets (EM). Also, the Fed chair Jerome Powell came up with apparently-dovish comments at the end of the month, which also gave EM assets a hand of late. So, iShares Core MSCI Emerging Markets ETF (IEMG - Free Report) created about $3.26 billion in assets in the month (read: Emerging Markets on a Rebound? 5 ETFs Seeing Big Inflows).

Technology and Communications Out of Favor

Rising rate and overvaluation concern caused a carnage in tech and internet stocks in mid-November. So, the tech-heavy Invesco QQQ Trust (QQQ - Free Report) lost about $1.62 billion in assets, Vanguard Information Technology ETF (VGT - Free Report) shed about $418.2 billion while Communication Services Select Sector SPDR Fund XLC lost about $546.5 billion in the month (read: Tech ETFs to Give Thanks Amid Bloodbath).

Corporate Bond ETF Falters Too

iShares iBoxx USD Investment Grade Corporate Bond ETF (LQD - Free Report) shed about $1.074 billion in assets in the fund, probably on rising rate concerns.

Banking Bust

SPDR S&P Regional Banking ETF (KRE - Free Report) shed about $438.9 billion in assetsin November as the yield curve flattened (read: What Caused Huge Outflows in Regional Bank ETFs in November).

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