Investors Plow Into Zero Fee, Natural Gas & Inverse ARK ETFs

They are among the fastest-growing exchange-traded funds of 2023.

sumit
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Senior ETF Analyst
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Reviewed by: Sumit Roy
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Edited by: Sumit Roy

On Tuesday, I took a look at the fastest-growing ETFs of the year. Those were funds that are seeing large inflows as a percentage of the assets under management they started the year with. 

Most of those ETFs started with relatively low levels of assets—$10 million or less, in most cases. But their inflows this year have still been impressive, taking what were tiny funds into the tens of millions or hundreds of millions of dollars range. 

As promised, today I’ll be taking a look at ETFs that started the year with larger asset bases—at least $100 million. 

Naturally, the percentage growth for these funds is smaller, but still massive. 

For instance, the BNY Mellon US Large Cap Core Equity ETF (BKLC), the first “true” zero-fee ETF, has gathered $1.3 billion in inflows so far in 2023, a big haul for a fund that started the year with only $429 million in AUM. 

As I wrote earlier this month, BKLC’s inflows suggest that investors are finally taking notice of a fund that undercuts the already ultra-cheap ETFs that dominate the large cap equity segment. 

Bargain Hunting  

Following behind BKLC are two natural-gas focused ETFs, the ProShares Ultra Bloomberg Natural Gas (BOIL) and the United States Natural Gas Fund (UNG), with inflows of more than $1.1 billion each. 

It’s not hard to see why investors are plowing their money into this pair of ETFs. Natural gas prices have been cut in half since the start of the year.  

This looks like a clear case of bargain hunters seeking a bounce in a beaten-down commodity. 

Further down the list, the AXS Short Innovation ETF (SARK) is another standout. A big story this year has been the recovery in growth stocks, with the most beaten-down stocks of 2022 leading the way. 

The ARK Innovation ETF (ARKK), which holds many of those stocks, has benefited, leading to a 27% year-to-date gain for the fund. 

Clearly, some investors don’t see this as a sustainable move. SARK, which bets against ARKK, has collected just over $300 million of inflows this year, more than double the $258 million in AUM it started 2023 with.  

Investors buying up the Direxion Daily Semiconductors Bear 3x Shares (SOXS) probably have a similar thesis as investors in SARK. The fund provides triple-leveraged, inverse exposure to the index that underlies the iShares Semiconductor ETF (SOXX), which is up 19% so far this year. 

Year-to-date inflows of $1.3 billion for the fund compares to assets of $1.1 billion at the start of the year. 

 

Fastest Growing ETFs of 2023 (Starting AUM >$100M) 

TickerFundYTD 2023 Inflows ($M)Assets 12/31/22 ($M)Inflows %
BKLCBNY Mellon US Large Cap Core Equity ETF1261429294%
BOILProShares Ultra Bloomberg Natural Gas1583586270%
UNGUnited States Natural Gas Fund LP1103429257%
BKIEBNY Mellon International Equity ETF283146194%
BBEUJPMorgan BetaBuilders Europe ETF54763153174%
PFEBInnovator U.S. Equity Power Buffer ETF - February326228143%
FLKRFranklin FTSE South Korea ETF156124125%
SARKAXS Short Innovation ETF301258117%
SOXSDirexion Daily Semiconductors Bear 3x Shares12921131114%
FXOFirst Trust Financial AlphaDEX Fund1048111494%
JVALJPMorgan US Value Factor ETF36842487%
DIVIFranklin International Core Dividend Tilt Index ETF8611277%
SQQQProShares UltraPro Short QQQ2986430469%
IBDWiShares iBonds Dec 2031 Term Corporate ETF10515468%
RFVInvesco S&P MidCap 400 Pure Value ETF12318367%
PJANInnovator U.S. Equity Power Buffer ETF - January25938867%
XESSPDR S&P Oil & Gas Equipment & Services ETF20231265%
FEMSFirst Trust Emerging Markets Small Cap AlphaDEX Fund10516763%
FNGDMicroSectors FANG+ Index -3X Inverse Leveraged ETNs due January 8 20389014861%
JEPQJPMorgan Nasdaq Equity Premium Income ETF577100457%

 

Email Sumit Roy at [email protected] or follow him on Twitter sumitroy2    

Sumit Roy is the senior ETF analyst for etf.com, where he has worked for 13 years. He creates a variety of content for the platform, including news articles, analysis pieces, videos and podcasts.

Before joining etf.com, Sumit was the managing editor and commodities analyst for Hard Assets Investor. In those roles, he was responsible for most of the operations of HAI, a website dedicated to education about commodities investing.

Though he still closely follows the commodities beat, Sumit covers a much broader assortment of topics for etf.com, with a particular focus on stock and bond exchange-traded funds.

He is the host of etf.com’s Talk ETFs, a popular video series that features weekly interviews with thought leaders in the ETF industry. Sumit is also co-host of Exchange Traded Fridays, etf.com’s weekly podcast series.

He lives in the San Francisco Bay Area, where he enjoys climbing the city’s steep hills, playing chess and snowboarding in Lake Tahoe.