Steady rise of ETF flows bodes well for emerging markets, say analysts

Emerging market ETFs see inflows of $6.5 billion in the last one month

Emerging market (EM) ETFs have started to see steady flows, shows recent data. In the last week, these ETFs saw inflow of $1.58 billion. Over the last one month, inflow has been to the tune of $6.5 billion. Analysts say the steady rise of ETF flows bodes well for EMs even as active asset managers hold a bearish outlook on the EMs. Unlike some of its EM peers, India seems to be on the right side of these ETF flows. In the last one-month period, India has garnered flows of $2.23 billion, which is the highest in the EM pack. In contrast, China has seen the highest outflows ($5.31 billion) in the same period. The concerns on growth slowdown in China due to ongoing trade tensions with US, could bring higher flows for India going ahead. Some of the ETFs that have seen steady flows in last one-month period include those of Vanguard FTSE Emerging Market ($555 million) and Ishares Core MSCI Emerging Market ($1.38 billion).