Jun. 22 at 2:26 PM
July 1st marks the beginning of a new allocation cycle as retirement contributions, target-date funds, passive allocations, mutual fund inflows, & systematic strategies begin deploying fresh capital
As one of the largest pools of assets in the world resets portfolios for a new quarter & a new half of the year, market leadership can increasingly be driven by the destination of those flows
ETFs have accounted for ~31% of avg daily trading volume YTD, well above the 10-yr avg of ~27%. As a larger share of market activity flows through passive vehicles, reallocation decisions can have an increasingly meaningful impact on price action
ETFs have already attracted more than
$1T in inflows YTD, ~45% ahead of last year’s record pace. For perspective, the avg full-year ETF inflow thru 2024 was ~
$490B. In less than 6 months, ETF investors have already allocated more than twice the amount that historically represented a full year’s worth of flows
AUM in these ETFs have reached a record ~
$218B - increasing by roughly
$82B (+60%) since the end of March alone
Leverage tied to tech has grown +136% over the same period, while leverage linked to semiconductor exposure has nearly tripled (+175%)
Today roughly 18 cents of every dollar allocated to the S&P 500 is directed toward semiconductor companies, 33 cents flows into the Mag 7, & nearly 40 cents is concentrated in the index’s 10 largest holdings.
$SCHW $BLK $HOOD $JPM $SOXL