Fund flows are an important indicator for uncovering promising exchange-traded funds (ETFs). By tracking this metric, investors can uncover market trends and pinpoint the best ETFs to buy.
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Fund flows reflect the net movement of money into or out of an ETF over a set period, offering valuable insight into investor sentiment. When demand for an ETF rises, new shares are created, leading to inflows and boosting its assets under management (AUM). Conversely, when investors sell ETF shares, outflows occur, reducing the fund’s AUM. The net fund flow—calculated as the difference between inflows and outflows—reveals an ETF’s popularity and potential for performance.
With this perspective, the TipRanks ETF Screener emerges as a powerful tool for investors. By focusing on ETFs with significant fund flow activity, this tool empowers investors to identify high-potential opportunities.
iShares Russell 2000 ETF (IWM)
The iShares Russell 2000 ETF (IWM) tracks a market-cap-weighted index of U.S. small-cap stocks. The index selects stocks ranked 1,001-3,000 by market cap. The ETF has $73.8 billion in AUM, fund flows of $815.38 million and an expense ratio of 0.19%.
Over the past year, IWM has increased by more than 15%. Analysts remain cautiously optimistic about IWM stock, with a Moderate Buy consensus rating based on 1253 Buys, 651 Holds, and 51 Sells. The average IWM price target of $280.47 implies an upside potential of 22.1% from current levels.
SPDR Dow Jones Industrial Average ETF Trust (DIA)
The SPDR Dow Jones Industrial Average ETF Trust (DIA) tracks a price-weighted index of 30 large-cap US stocks, selected by the editors of the Wall Street Journal. The ETF has $38.6 billion in AUM, fund flows of $456.47 million and an expense ratio of 0.16%.
Over the past year, DIA has increased by more than 15%. Analysts remain cautiously optimistic about DIA stock, with a Moderate Buy consensus rating based on 27 Buys and four Holds. The average DIA price target of $483.70 implies an upside potential of 8.7% from current levels.
Direxion Daily S&P 500 Bull 3x Shares (SPXL)
The Direxion Daily S&P 500 Bull 3x Shares (SPXL) provides daily leveraged exposure to a market-cap-weighted index of 500 large-cap and mid-cap US companies selected by the S&P Committee. The ETF has $5.2 billion in AUM, fund flows of $390.8 million and an expense ratio of 0.91%. Over the past year, SPXL has increased by more than 65%.
Key Takeaway
Fund flows offer insights into investor sentiment and market trends. Rising flows in all the three ETFs reflect investors’ growing confidence in the U.S. market with a renewed interest in large, small and mid-cap stocks.
