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Investors Jump Back Into ETFs to Join in Stock Rally
06 Feb 2012 EST - CNBC.com
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“Pros are using the ETF space to quickly trade in areas that used to be tougher to trade in, i.e., foreign currencies,” said Michael Murphy, president of Rosecliff Capital.

When looking at which ETFs received the biggest inflows, a “risk-on” mentality was clearly in place to start 2012 as these events unfolded. The two most popular ETFs in terms of inflows were the Vanguard MSCI Emerging Markets ETF and the iShares MSCI Emerging Markets Index Fund, according to IndexUniverse. ETFs that invest in high yield bonds also garnered a lot of interest.

Investors believe the agility and broad exposure of ETFs may cut down on their chances of missing out on a market surge, when before they had to rely on buying individual stocks or mutual fund that would do it for them. The mutual fund industry experienced inflows since the start of 2012, but not nearly at the speed of ETFs, according to figures from the Investment Company Institute.

“Everyone is using ETF’s, from the retail investors, the investment professionals, to the day traders,” said Mitchell Goldberg of ClientFirst Strategy. “ETF sponsors really tout diversification and unique slices of the market, such as trading volatility or tracking metals prices. They give investors a ‘go anywhere at any time’ ability.”

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