Investors Pour into Long Volatility ETFs Despite Steep Weekly Declines

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Weekly Channel Summary

The Alternatives channel, comprising 47 ETFs from 26 issuers, currently holds $13.60 billion in total assets. This past week, the channel attracted $132 million in net inflows, contributing to a robust year-to-date total of $3.92 billion. Over the last twelve months, investors have allocated a net $5.01 billion into these strategies.

This Week’s Performance Leaders and Laggards

Volatility-focused strategies showed a stark divergence in weekly performance. Short Volatility products led the channel with a 1.30% gain, while Long Volatility funds were the worst performers, declining by 2.75%. On a year-to-date basis, Managed Futures strategies remain the clear leader with a 12.00% return, whereas Long Volatility funds have posted a significant loss of 34.78%.

Absolute Return Performance Snapshot

Absolute Return WTD 1 Month 3 Month 6 Month YTD 1 Year
Managed Futures 1.28% 1.15% -0.58% 2.93% 12.00% 21.98%
Event Driven 0.03% 0.70% 1.00% 1.49% 2.96% 4.12%
Multi-Strategy -0.10% 1.33% 1.63% 3.67% 7.63% 14.05%

Volatility Performance Snapshot

Volatility WTD 1 Month 3 Month 6 Month YTD 1 Year
Vol – Short 1.30% 5.10% 13.23% 12.66% 8.60% 25.73%
Vol – Long -2.75% -13.55% -31.96% -38.41% -34.78% -56.32%

Top & Bottom 5 ETFs by Weekly Performance

The Simplify Multi-QIS Alternative ETF (QIS) was the standout performer this week, delivering a strong 7.67% return. It was a challenging week for other funds, particularly the Opportunistic Trader ETF (WZRD), which registered the largest decline of 10.89%. Several other top performers were also in the managed futures space, including the Simplify Managed Futures Strategy ETF (CTA), which gained 5.00%.

Ticker Fund Name WTD Performance
Top Performers
QIS Simplify Multi-QIS Alternative ETF 7.67%
CTA Simplify Managed Futures Strategy ETF 5.00%
FFUT Fidelity Managed Futures ETF 2.88%
WTIP WisdomTree Inflation Plus Fund 1.95%
SVIX -1x Short VIX Futures ETF 1.85%
Bottom Performers
WZRD Opportunistic Trader ETF -10.89%
UVIX 2x Long VIX Futures ETF -4.82%
UVXY ProShares Ultra VIX Short-Term Futures ETF -3.48%
VIXY ProShares VIX Short-Term Futures ETF -2.25%
VXX iPath Series B S&P 500 VIX Short-Term Futures ETN -2.09%

Analyzing the Weekly Flows

The Alternatives channel recorded net inflows of $132 million for the week. Long Volatility strategies were the primary driver of this activity, attracting $95 million despite poor weekly performance. Managed Futures funds also saw healthy demand with $53 million in new assets, while Short Volatility products experienced the largest redemptions, shedding $19 million.

Absolute Return Flows Summary

Absolute Return Fund Count AUM 5 Day 30 Day 90 Day YTD 1 Year
Managed Futures 16 $7.82B $53M $250M $672M $2,772M $3,678M
Multi-Strategy 12 $2.89B $2M $60M $407M $924M $1,169M
Event Driven 8 $429M $1M $3M -$1M -$28M -$7M

Volatility Flows Summary

Volatility Fund Count AUM 5 Day 30 Day 90 Day YTD 1 Year
Vol – Long 6 $1.39B $95M $327M $149M $440M $548M
Vol – Short 5 $1.07B -$19M -$59M -$149M -$186M -$378M

Top & Bottom 5 ETFs by 5-Day Flow

The iMGP DBi Managed Futures Strategy ETF (DBMF) led all funds in the channel, gathering $51 million in net new assets. On the other end of the spectrum, the -1x Short VIX Futures ETF (SVIX) saw the largest weekly redemption, with outflows totaling $9 million. The Simplify Managed Futures Strategy ETF (CTA) also experienced notable outflows of $7 million.

Ticker Fund Name 5-Day Flow
Inflows
DBMF iMGP DBi Managed Futures Strategy ETF $51M
VXX iPath Series B S&P 500 VIX Short-Term Futures ETN $37M
UVIX 2x Long VIX Futures ETF $23M
UVXY ProShares Ultra VIX Short-Term Futures ETF $15M
VIXY ProShares VIX Short-Term Futures ETF $15M
Outflows
SVIX -1x Short VIX Futures ETF -$9M
CTA Simplify Managed Futures Strategy ETF -$7M
SVXY ProShares Short VIX Short-Term Futures ETF -$6M
SVOL Simplify Volatility Premium ETF -$6M
HDG ProShares Hedge Replication ETF -$6M

Issuer League Table Update

iM and Simplify remain the dominant issuers in the Alternatives space, commanding 29.45% and 16.41% of the market share, respectively. This week, iM led all issuers in asset gathering, bringing in $51 million in net inflows. Conversely, Simplify experienced the largest net outflows among its peers, with investors pulling $13 million from its funds.

Top 5 Issuers by AUM

Brand Fund Count AUM AUM Market Share
iM 1 $4.00B 29.45%
Simplify 5 $2.23B 16.41%
New York Life Investments 2 $1.27B 9.35%
Franklin 1 $1.05B 7.72%
ProShares 6 $958M 7.04%

Top & Bottom 3 Issuers by 5-Day Flow

Brand 5-Day Flow
Inflows
iM $51M
iPath $39M
ProShares $22M
Outflows
Simplify -$13M
Altshares -$1M
Unlimited -$1M

For a deeper dive into these trends, access our FREE, in-depth Alternative ETF reports in the right side panel of this page.

Disclosures

This material is for informational purposes only and should not be considered investment advice. All investments, including ETFs, involve risk, including the possible loss of principal. Investors should consider their investment objectives, risks, charges, and expenses carefully before investing.

This analysis was developed by the team at ETF Action. We leverage advanced AI tools to assist in the drafting and refinement of our content, based on our expert prompts, direction, and final review.