Investors Pour in to Financial ETFs before Fed’s December Meeting
Fund flows to KBE
Exchange-traded fund investors have added $55.4 million to the SPDR S&P Bank ETF (KBE) during November so far. Year-to-date, investors have poured $226 million into the KBE ETF. During the week ended November 20, the KBE fund has seen inflows of $77.8 million.
Shares of KBE have generated returns of 8.3% year-to-date, outperforming the Financial Select Sector SPDR ETF (XLF) as well as the broad market. In the past month, KBE has returned 4.5% due to increased optimism in the financial sector after the increased possibility of a rate hike in December.
Changes in institutional investors’ holdings in 3Q15
Despite the positive flows to the KBE ETF over the past year, 13F filings of major institutional asset managers for 3Q15 gave a mixed picture.
In 3Q15, trade activity by 13F filers displayed a 13.1% decline in aggregate shares held by institutional investors and hedge funds. Among the 133 13F filers holding the stock, 43 funds reduced their exposure to KBE, while 21 funds sold all their holdings. However, 40 funds created new positions and 20 funds increased their exposure to KBE.
Major institutional holders Franklin Resources (BEN), Schroder Investment Management, Wexford Capital, Bank of America (BAC), and JP Morgan (JPM) bought shares of KBE during the third quarter.
Meanwhile, institutional investors Goldman Sachs (GS), Citigroup (C), Morgan Stanley, Barclays, and Stadion Money Management significantly reduced their exposure to KBE.
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