Amid the market turbulence caused by new tariffs from the Trump administration, investors are turning to exchange-traded funds (ETFs) for hedging. Data compiled by Bloomberg Industry Research analyst Athanasios Psarofagis shows a significant net inflow into ETFs that act as cash alternatives, focus on gold, and track inverse stock index returns. By Thursday, these ETFs attracted over $4 billion, marking one of the largest weekly inflows since 2019.
Specifically, three gold-related ETFs—GLD, IAU, and IAUM—attracted over $650 million from Monday to Thursday, accumulating $9.9 billion since the beginning of the year. Additionally, investors are heavily buying ultra-short-term Treasury ETFs, seen as safe havens. The iShares 0-3 Month Treasury Bond ETF (SGOV) and SPDR Bloomberg 1-3 Month T-Bill ETF (BIL) together received $3.5 billion in the first four trading days of the week.
Psarofagis noted that ETF investors are gravitating towards any form of hedging tools—be it gold, cash, or other safe havens outside the stock market. Beyond ETFs, investors are also seeking other safe assets, including U.S. Treasuries and currencies like the Japanese yen and Swiss franc.
