ETF Weekly Fund Outflow Report

Date: August 17, 2025
Headline: Tech and Energy ETFs Face Outflows Amid Shifting Risk Appetite

Market Overview
This week’s fund flows reflect a mixed shift in investor positioning, with notable outflows from growth-oriented equity sectors and leveraged products. The top 10 ETFs by outflow are heavily weighted toward communication services, semiconductors, and energy, alongside leveraged tech and single-stock vehicles. While equity-focused ETFs dominate the list, bond ETFs also saw outflows, suggesting a lack of clear sectoral preference. Year-to-date performance varies widely, with some high-growth names showing strong returns but facing profit-taking, while leveraged and single-stock products struggle with volatility or underperformance. Macro context remains neutral, with no immediate signals pointing to earnings season or central bank events influencing flows.

ETF Highlights
The Communication Services Select Sector SPDR Fund (XLC), tracking large-cap tech and media stocks, saw $3.25B in outflows despite a 15% YTD gain. Its $25.47B AUM amplifies the scale of the withdrawal, which may indicate caution after a strong rally or a broader rotation away from growth equities.

The Direxion Daily Semiconductor Bull 3X Shares (SOXL), a leveraged bet on semiconductors, lost $1.35B, despite a modest 0.22% YTD rise. Leveraged ETFs often see outflows during volatile periods, and SOXL’s high expense ratio and sensitivity to volatility could be contributing factors.

The First Trust Cloud Computing ETF (SKYY), focused on cloud infrastructure and software, faced $550M in outflows. With a 1.63% YTD gain and $2.91B AUM, the outflow may reflect profit-taking or a strategic rebalancing in the broader tech sector.

The iShares Expanded Tech-Software Sector ETF (IGV), which targets software and IT services, saw $475M in outflows despite an 8.98% YTD rise. Its strong performance could be prompting investors to lock in gains, while its $9.88B AUM highlights the magnitude of the exodus.

The SPDR Portfolio Aggregate Bond ETF (SPAB), a core bond benchmark, lost $372M in outflows despite a 2.08% YTD gain. The outflow contrasts with its typically stable demand, possibly signaling a shift toward alternative fixed-income strategies or risk-on positioning.

The iShares MSCI Japan ETF (EWJ), tracking Japanese equities, saw $342M in outflows despite a robust 19.45% YTD gain. The outflow could reflect profit-taking after a strong regional rebound or concerns over valuation levels.

The ProShares UltraPro QQQ (TQQQ), a 3X NASDAQ-100 leveraged ETF, lost $342M, despite a 17.86% YTD rise. Leveraged products often see outflows as investors reduce exposure to volatility, particularly after extended gains.

The SPDR Portfolio Long Term Corporate Bond ETF (SPLB), focused on long-dated corporate debt, faced $294M in outflows. With a 1.44% YTD gain and relatively modest $901M AUM, the outflow may reflect tactical shifts within the fixed-income space.

The Direxion Daily TSLA Bull 2X Shares (TSLL), a leveraged bet on Tesla, lost $282M, despite a steep -55.72% YTD decline. The outflow likely reflects reduced speculative interest amid the underlying stock’s underperformance.

The Energy Select Sector SPDR Fund (XLE), tracking energy stocks, saw $266M in outflows despite a -0.12% YTD decline. The outflow could signal a rotation away from energy amid mixed commodity outlooks or sector-specific concerns.

Notable Trends
The dominance of tech and leveraged ETFs in the outflow list highlights a possible rotation away from growth assets and speculative bets. High-YTD performers like XLC, TQQQ, and EWJ face outflows, suggesting profit-taking after strong runs. Conversely, TSLL’s outflow aligns with its poor performance, underscoring the risks of leveraged exposure to volatile stocks. The energy sector’s outflow, despite a flat YTD result, may reflect broader sector rotation rather than performance-driven exits.

Conclusion
This week’s flows suggest a cautious shift in positioning, with investors scaling back exposure to high-growth and leveraged equities, as well as energy. The mixed YTD performance across the top outflow list indicates a blend of profit-taking and strategic rebalancing. While bond ETFs also saw outflows, their inclusion underscores a lack of clear safe-haven demand. Overall, the data may signal a temporary pullback from extended growth narratives and a search for value or stability in a more fragmented market environment.