ETF money flows show what may be out of favor in the market. Unsurprisingly, the flows are consistent with market direction or momentum trading. The largest inflows over the last six months have been in the S&P 500, MSCI Japan, and the financial services sector. The greatest outflows have been in gold, emerging markets and investment grade bonds. The outflow from gold has been almost double what has gone into the S&P 500.While consistent with with the directional moves, flows provide a confirming signal on what is in and out of favor.
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