Financials Roundup: Markets Take a Break from a 5-Week Rally
Fund flows
So far in 2016, ETF investors withdrew $1.8 billion from the Financial Select Sector SPDR ETF (XLF). ETF investors added funds worth $4.9 million to XLF’s portfolio during the week ending March 24. They withdrew $85 million during March. During the week, XLF underperformed the SPDR S&P 500 ETF (SPY). It lost 1.4%. So far in 2016, XLF fell 6.4% due to fears of a global slowdown, plunging commodity prices, and falling expectations of a rate hike. All of these factors led to increasing doubts about the health of the US economy.
Institutional investors’ holdings
13F filings of major institutional asset managers for 4Q15 give a mixed picture for XLF.
In 4Q15, trade activity by 13F filers displays a 7.4% reduction in aggregate shares held by institutional investors and hedge funds. Among the 611 13F filers holding the stock, 177 funds reduced their exposure to XLF and 56 funds sold all their holdings of XLF. However, 93 funds created new positions and 254 funds increased their exposure to XLF.
Major institutional holders like Bank of America (BAC), Franklin Resources (BEN), Jefferies, and Passport Capital increased their exposure to XLF in the fourth quarter. Among these, Bank of America added fresh holdings of XLF to its portfolio.
Institutions that significantly reduced their exposure are BNP Paribas, Goldman Sachs (GS), and Nomura (N). Among these, Nomura sold all of its shares of XLF.
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