ETF assets top $3 trillion after huge July inflows

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ETFs are traded on exchanges, so they can be bought and sold like stocks through a brokerage.

Not everyone is convinced rates are going to remain low forever. After lagging all year, money has finally started to flow into financials, clearly a bet that rates will be rising.

But as a general rule, it’s certainly true that investors are just not into the safety plays right now. Look at gold, which saw $2.4 billion in outflows, nearly 8 percent of its assets under management. Gold miners also saw outflows.

International funds have been stars all year, and remained so in July. Funds like iShares EAFE, which invests principally in Europe, and the iShares Emerging Markets, which invests principally in China, South Korea, India, and Brazil, both saw significant inflows. Flows into IEFA, for example, are up over 40 percent this year.

Finally, as the mostly passive (indexed) ETF business keeps growing, the outcry from active managers continues unabated. But Blackrock, the biggest ETF provider through its iShares franchise, which this month celebrated the fifteenth anniversary of the first bond ETF, quietly pointed out that ETFs are still a tiny part of the bond and stock market, about 8 percent of the roughly $26 trillion stock market, and less than 1 percent of the roughly $38 trillion bond market.

“We are 25 years away from the question, is passive big enough to displace price setters?” Martin Small, the head of iShares America, told me last week.