Stocks have had a rough go of it so far this month. The Russell 2000, an index of small-cap stocks, and the Nasdaq, an index largely comprised of tech stocks, are down 3.5% and 2.7%, respectively, since March 31.
The MSCI All Country World Index excluding U.S. stocks and the S&P 500 haven't given up as much ground, but are both negative on the month as well.
Despite the sell-off, however, equities as an asset class remain the most popular destination for investment flows, as the chart below illustrates.
"Flow into equity ETFs is still pretty robust," says David Keeble, global head of interest rates strategy at Crédit Agricole.
"Indeed, the $10 billion month-to-date equity inflow compares to a 12-month inflow of approximately $154 billion, so there really isn't any evidence of slowing purchases."
The next chart shows which stocks are receiving the inflows.
"What is new is that there are now small outflows from small-caps, something that is clearly impacting indices like the Nasdaq and Russell 2000," says Keeble.
"Over the past 12 months, there has been a continual flow into international equity ETFs, and to a lesser extent large-cap American funds, and this has persisted in April, so far."
Of course, flows typically follow performance, so there could be more outflows ahead. However, if the turn up in equity indices over the last few days sticks, outflows from stocks could be somewhat muted.
