Broad Equity and Thematic ETFs See Outflows as Investors Reassess Positions

Date: January 20, 2026

Market Overview

Today’s net fund outflows highlight a broad-based reduction in exposure across equity, sector, and thematic ETFs, with notable activity in large-cap benchmarks, leveraged products, and commodities. While outflows spanned multiple asset classes, equity-focused funds accounted for the largest absolute withdrawals, suggesting a potential shift in risk appetite or profit-taking in high-performing areas. The data does not immediately point to a sector-specific or macro-driven rotation, though leveraged and commodity-linked ETFs saw significant outflows despite strong year-to-date performance.

ETF Highlights

IVV - iShares Core S&P 500 ETF As the largest U.S. equity ETF with $765.76 billion in assets, IVV’s $4.24 billion outflow reflects reduced demand for broad market exposure. The fund’s 0.63% decline and 0.63% YTD underperformance may have prompted investors to lighten positions, though the outflow’s scale suggests a broader reassessment of large-cap equity positioning.

VOO - Vanguard S&P 500 ETF VOO, the second-largest S&P 500 ETF with $861.36 billion in AUM, posted a $1.77 billion outflow. Its -0.63% daily drop and -0.63% YTD performance align with IVV’s trend, indicating a coordinated reduction in core equity holdings. The outflow underscores caution in large-cap benchmarks despite their dominant market weight.

SOXL - Direxion Daily Semiconductor Bull 3X Shares The leveraged semiconductor ETF, up 37.85% YTD, saw a $779 million outflow. The sharp withdrawal could signal profit-taking in a high-performing, volatility-sensitive product. Its 3X leverage and sector-specific focus may have amplified investor caution amid near-term uncertainty.

AIRR - First Trust RBA American Industrial Renaissance ETF AIRR, a niche industrial theme ETF, recorded a $757 million outflow despite a 13.61% YTD gain. The divergence between performance and outflows might reflect a strategic rebalancing away from cyclical themes, particularly as industrial sectors face margin pressures.

SLV - iShares Silver Trust The silver-linked ETF, up 32.55% YTD, faced a $528 million outflow. The outflow may indicate reduced speculative interest in commodities, even as silver prices have surged. Its $46.91 billion AUM suggests a broader shift in commodity positioning rather than isolated retail activity.

XLRE - State Street Real Estate Select Sector SPDR ETF XLRE, up 2.60% YTD, posted a $525 million outflow. The real estate sector’s modest gains contrast with the outflow, potentially signaling a rotation away from commercial real estate amid lingering concerns about valuations and interest rate sensitivity.

LQD - iShares iBoxx USD Investment Grade Corporate Bond ETF LQD, a $27.52 billion corporate bond ETF, saw a $455 million outflow. The -0.26% daily decline and mixed YTD performance could reflect a shift toward cash or government bonds, though the outflow’s scale suggests a broader reevaluation of credit risk.

IWD - iShares Russell 1000 Value ETF IWD, focused on large-cap value stocks, recorded a $329 million outflow despite a 2.66% YTD gain. The outflow may indicate a tactical rebalancing away from value equities, which have outperformed growth in recent months, as investors lock in gains.

DIA - SPDR Dow Jones Industrial Average ETF Trust DIA, the Dow 30-tracking ETF with $44.5 billion in AUM, posted a $272 million outflow. Its 0.90% daily gain contrasts with the outflow, suggesting a selective reduction in blue-chip equity exposure despite sector strength.

IWM - iShares Russell 2000 ETF IWM, representing small-cap equities, saw a $224 million outflow despite a 6.67% YTD gain. The outflow could reflect a rotation away from small-cap growth, which has benefited from rate-cut expectations, as investors shift toward defensive or cash positions.

Notable Trends / Surprises

The outflows highlight a mixed picture: while large-cap benchmarks and leveraged products dominated the list, high-performing themes like semiconductors and industrials also saw significant withdrawals. The absence of bond-heavy outflows beyond LQD suggests a more targeted shift rather than a broad flight from credit. The presence of both growth (SOXL) and value (IWD) ETFs in the outflow ranks may indicate a sector-specific rebalancing rather than a growth-versus-value rotation.

Conclusion

Today’s outflows may signal a cautious reassessment of positions across equity benchmarks, leveraged products, and thematic ETFs. The scale of withdrawals from large-cap S&P 500 funds and high-performing leveraged and commodity ETFs could reflect a combination of profit-taking and shifting risk preferences. However, the absence of a clear sector or asset-class concentration suggests a fragmented response to near-term uncertainties, with investors selectively reducing exposure to overbought areas without a unified market-wide trend.