In my latest “Money in Motion” video insight, I’m highlighting a developing trend that challenges a decade-long assumption about investor behavior. After digging into our weekly flow data, a significant shift poses a compelling question: Are asset allocators finally giving up on large-cap value?
The Old Playbook: A Decade of Rebalancing
For the past ten years, I’ve watched a predictable pattern dominate the ETF landscape. Asset allocators faithfully followed the “buy low, sell high” mantra. When large-cap growth stocks outperformed, investors would rebalance their portfolios by selling those winners and rotating into the relative “loser”—large-cap value. This prudent, mean-reversion strategy meant that even in years where growth stocks soared, value-focused ETFs often saw stronger, more consistent inflows.
The New Trend: Chasing Performance
That trusted playbook is now being rewritten. Our recent data shows a dramatic reversal of this trend. After 2022, the flows have begun to chase performance, with investors piling into large-cap growth after its strong run.
This isn’t a small shift. As I point out in the video, “last year” saw a staggering $106 billion flow into large-cap growth ETFs, compared to just $54 billion for value. This trend has continued “this year,” suggesting a major inflection point in allocator strategy.
Why This Matters: An Inflection Point
This insight suggests that investors are no longer rebalancing. Instead, they are letting their winners ride—a significant behavioral change that bucks a trend we’ve observed for over a decade. Are investors now convinced that the growth-versus-value story has played out, or is this a new form of performance chasing?
Watch the Video & See the Data for Yourself
This summary only scratches the surface. In the full video, I use our ETF Action platform’s free tools to dive deep into the data, showing you exactly how I spotted this trend and how it’s unfolding in real-time.
To explore these insights and use the same tools I demonstrate—including our in-depth AUM reports and the powerful Navigator tool—create your free ETF Action account today. Don’t just read about the trends; see them for yourself.
Disclosures
This material is for informational purposes only and should not be considered investment advice. All investments, including ETFs, involve risk, including the possible loss of principal. Investors should consider their investment objectives, risks, charges, and expenses carefully before investing.
This analysis was developed by the team at ETF Action. We leverage advanced AI tools to assist in the drafting and refinement of our content, based on our expert prompts, direction, and final review.
