The world’s biggest exchange-traded funds have shed billions in assets in recent weeks, with the top three losing about 7% since last week’s market rout began, even as investors continue buying funds and betting markets will turn around.
The Vanguard S&P 500 ETF (VOO), the SPDR S&P 500 ETF Trust (SPY) and the iShares Core S&P 500 ETF (IVV) were all well above or hovering around $600 billion in assets, with VOO (the world’s biggest ETF) and SPY both pushing toward $650 billion before markets began tumbling around the time Donald Trump was sworn in as president.
Today, each has dipped below $550 billion, with their asset declines accelerating since April 2 when President Trump imposed tariffs on nearly all countries before pausing most of them yesterday. The three hold $1.6 trillion in assets as of Wednesday, down from more than $1.7 trillion last week.
Those drops in assets have been slowed by billions flowing into the funds in so-called “buy the dip” bets, where investors bet markets will turn up and returns will be magnified by virtue of having bought at lower prices.
VOO, with $536.2 billion in assets, brought in $10.7 billion in the previous five days. Investors continued putting money into the fund even after it dropped 12% between April 2 and April 8.
SPY, with $526.5 billion in assets, pulled in $11.7 billion over the past five sessions, while IVV, at $515.1 billion, had $1.6 billion in outflows.
Source: etf.com data
Strategies betting on a market turnaround since last week’s “Liberation Day” have yet to pay off. While broad stock markets soared yesterday and the Nasdaq had a double-digit percentage gain that was its biggest jump in decades, stocks fell today on fears that a trade war with China will spark a U.S. recession.
VOO, favored by retail investors to gain low-cost exposure to broad equity markets, is down 12% so far this year.
