The ‘En Masse’ Market Cash-Out In Perspective
I'm not sure I'd call it an "en masse cash-out" -- as one mainstream financial media outlet loudly declared -- but investors did pull a meaningful amount from stock funds over the past two weeks.
Typically I don't trumpet weekly flows data, preferring instead to pen short updates for the narrower audience who's interested in the ebb and... well, the ebb and flow. But in light of equities' worst run since the onset of the rally in October, it's worth giving the numbers something more than short
I appreciate your caution on reporting these numbers. A long time ago (20 years…) these were almost the most important things I watched. (As JL said, fundamentals schmudimentals or something.) But as time passed, ETF flow data included hedge funds which still was interesting. And in terms of absolute dollar flows, buy0backs came to eclipse those flows.
But now, how much of the numbers are CTA funds and volatility-driven algos? The latter probably still operate through the S&P futures, but perhaps there is some spillover?
Anyway, still interesting, but to continue to label these flows as being “retail” money is hopelessly out of date.
@derek, have you read any CTA info? I saw something about very sizeable CTA selling expected in coming weeks (Goldman note I think)
Sorry, I have not. But it makes sense thar some trend following or momentum models might be close to flipping. But many do not appear to be so sensitive to shorter-term moves.
I just meant that I normally confine the flows updates to the Duly Noted section because a lot of times there’s no real “hook,” so to speak. It’s more like, “Well, here’s these numbers if you’re interested.” Duly Noted morphed into something a little different than I originally intended when I created the two-tiered system last year, but as originally envisioned, the idea was to use that section as an overflow valve and a place for stuff like flows data.