In this week’s ETFs & Markets video, Chief ETF Strategist Todd Sohn discusses:

• Equity ETF flows coming off the boil
• Sector flows reflect defensive adjustments
• T-Bill inflows shifting equity vs. bond ETF spread

Defintions:

S&P 500 – A widely used stock market index that tracks 500 large-cap U.S. companies across multiple sectors.

SPDR S&P 500 ETF Trust (SPY) –designed to track the performance of the S&P 500 Index.

Equity ETF – An ETF that invests primarily in stocks, providing exposure to a broad market or specific sectors.

Fixed Income ETF - A fixed income ETF (exchange-traded fund) is a basket of bonds or other debt securities that trades on stock exchanges, offering investors diversified exposure to income-generating assets. They provide liquidity, transparency, and lower costs compared to buying individual bonds, with types including government, corporate, and municipal bonds.

Fund Flow - Fund flow refers to the net movement of cash into and out of investment vehicles (like mutual funds or ETFs) or the movement of working capital within a company. It tracks investor sentiment and capital allocation, with net inflows indicating popularity and net outflows signaling divestment, independent of the asset's actual performance.

Volatility - Volatility is the tendency for asset prices to change rapidly, unpredictably, and often. In finance, it represents the degree of price fluctuation, with high volatility indicating higher risk.

Treasury Bill ETF - A Treasury bill (T-Bill) ETF is an exchange-traded fund that invests in short-term U.S. government debt obligations with maturities of one year or less. These funds offer high liquidity, safety, and a steady income stream, allowing investors to buy and sell them on a stock exchange like a stock rather than holding individual T-bills

Cyclical Sector - A cyclical sector ETF is an exchange-traded fund that invests in companies whose performance is closely tied to economic cycles, performing best during growth and expanding phases.

Defensive Sector - A defensive sector ETF is an exchange-traded fund that invests in industries providing essential services (e.g., consumer staples, healthcare, utilities) with stable demand regardless of the economic climate.

Quintile - any of five equal groups into which a dataset can be divided according to the distribution of values of a particular variable.

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The ETFs described herein are referenced solely for illustrative purposes and should not be construed as an investment recommendation. An investment in exchange traded funds involves risk, including the possible loss of principal. For important disclosures and risks relating to each ETF referenced herein, see each respective funds’ prospectus or contact your financial professional.