BlackRock writes that USD234.4 billion was added to global ETPs in September – the highest inflow month on record, with a strong showing from equity (USD153.4 billion), fixed income (USD50.9 billion) and commodity (USD19.3 billion) ETPs.
Equity flows were predominantly driven by US exposures in September (USD76.5 billion) – the highest month for any single equity exposure this year.
Inflation protection in vogue: Gold ETPs saw the highest monthly inflows on record (USD16.2 billion), with positive inflows from US, EMEA and APAC investors alike. Inflation linkers saw their highest inflows since May, in a ninth consecutive month of positive flows.
Fixed income – beneath the fixed income hood
After hitting a new record in August (USD66.6 billion), fixed income flows moderated to a still-strong USD50.9 billion in September. Broad market and rates ETPs remained the most popular single fixed income allocations. However, the firm writes that demand for rates exposures dipped in September, with only USD11.3 billion added versus USD17.5 billion in August, driven by long duration US Treasuries, with whispers of the looming US government shutdown dominating sentiment.
Investment grade (IG) credit flows also fell to USD3.8 billion versus USD16.9 billion in August, while high yield (HY) flows picked up to USD4.1 billion from USD2.7 billion in August, but with significant regional nuances.
Lower flows into IG were entirely driven by US exposures, while European (USD1.0 billion) and global (USD568 million) ETPs saw sustained inflows. The strength in HY was also driven by the USD space, with USD3.7 billion added – up from USD2.2 billion in August and contrasting with a fall in EUR HY flows, which turned flat after four consecutive months of steady inflows.
After a blowout summer, emerging market debt flows weakened to USD5.2 billion, albeit remaining above the pre-summer average of USD1.8 billion.
Equity – US equity dominance
Investors bought USD76.5 billion of US equity ETPs in September – the highest level since December 2024 and almost double the second-highest category (broad developed markets (DM), with USD39.7 billion). The demand was unanimous among US, EMEA and APAC investors, marking a potential recovery of foreign flows in a year characterised by a ‘ great repatriation’ trend.
European equity flows held up, with USD3.5 billion added (double the August flows but significantly lower than the USD5.9 billion seen in July). Emerging market (EM) flows surprised to the upside, with USD22.0 billion added – the second highest inflow month this year after consecutive outflows in July and August.
Sectorally, flows trends were dominated by the usual suspects: tech (USD14.2 billion) and financials (USD10.4 billion). Interestingly, materials inflows outpaced industrials for a second month in a row. This helped make Q3 the highest quarter on record for materials ETP flows, with USD10.1 billion added.
Commodities & linkers – Commodity flows pick-up
Gold ETPs attracted record monthly inflows of USD16.2 billion in September taking year-to-date inflows to USD60.3 billion, the highest inflow year on record. Demand was broad-based across US, EMEA and APAC investors, reflecting a renewed appetite for portfolio diversification and inflation hedging amid ongoing macro uncertainty. Silver ETPs also saw positive inflows for an eighth consecutive month, as investors look for alternative assets with high beta to gold.
Concurrently, inflation-linked bond ETPs notched their ninth consecutive month of positive flows, achieving their strongest intake since May, as investors sought continued exposure to assets offering protection against sticky inflation trends.
EMEA snapshot
The USD34.9 billion added to EMEA-listed equity ETPs in August was the highest on record, signalling a risk-on month for EMEA investors. Below the surface, this was driven by inflows into multiple categories, including an increase in flows into US equity (USD10.4 billion vs. USD8.1 billion in August), European equity (USD5.0 billion vs. USD2.3 billion previously) and broad DM equity (USD12.6 billion vs. USD8.1 billion). The pickup in EM equity flows was also particularly notable, at USD6.0 billion (6x August flows and 2x July flows).
EMEA-listed fixed income flows moderated to USD4.3 billion in September, more than halving the USD8.7 billion of inflows in August. This was driven by an outflow in rates ETPs, coupled with a large drop in monthly inflows into investment grade (IG) credit.
Rates outflows were driven by US and Spain, with negativity concentrated on longer-duration exposures. IG flow weakness was entirely US driven, masking the USD1.0 billion of inflows into EUR IG, steadily continuing from August’s USD0.9 billion. High yield (HY) was the most popular fixed income category for UCITS flows in September, with USD1.3 billion added vs. USD0.5 billion in August, when US HY flows dwarfed EUR and global inflows.
EMEA-listed commodity flows mirrored the global trend, with gold inflows rising to USD3.8 billion – the highest since March 2022 – and silver flows rising from USD0.4 billion in August to USD0.5 billion in September.
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