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Emerging market ETFs see outflows after four weeks ahead of US elections

US-listed EM ETFs that invest across developing nations, as well as those that target specific countries lost $103 million in the week ended October 30

Emerging markets | ETFs | US Presidential elections 2020


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Investors pulled money out of emerging market (EM) exchange-traded funds (ETFs) last week, snapping a four-week streak of inflows as the US election neared and rising coronavirus infections pushed some European autho­rities to reinstate lockdowns.

US-listed EM that invest across developing nations, as well as those that target specific countries lost $103 million in the week ended October 30, ending a month long rally that brought $3.09 billion in inflows, according to the Bloomberg data. The year’s outflows now reach $12.8 billion. The withdrawals were concentrated in developing-nation bond funds, which fell by $317.2 million.

The $17.2 billion iShares J. P. Morgan USD Bond ETF, known as EMB, suffered the largest withdrawals as money managers pulled $341 million last week, the most in a month.

Risk aversion was evident outside ETFs, too. MSCI’s iindices of emerging-market stocks and currencies both fell by the most in more than a month last week as infections rose and investors weighed the economic impact of renewed lockdowns.


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First Published: Tue, November 03 2020. 22:38 IST