How large were the inflows into Asian ETFs?

  • In the week ended 21 October 2026, emerging-market equity funds recorded net inflows of 33.5 billion US dollars. China ETFs attracted 17.3 billion US dollars; Citi noted that the previous inflow of this magnitude occurred in July.
  • Taiwan and South Korea ETFs attracted 6.9 billion and 5.8 billion US dollars respectively, bringing their combined total with China ETFs to 30 billion US dollars. Global emerging-market ETFs also returned to inflows, attracting 2.7 billion US dollars. This round of subscriptions went to both single-market and cross-market products.
  • ETF and non-ETF flows moved in different directions: China equity funds as a whole recorded net inflows of about 17 billion US dollars, less than the 17.3 billion US dollars received by ETFs, while non-ETF products saw net outflows of about 200 million US dollars. Rounding accounts for slight differences between the components and the total, but the preference for ETFs is clear.

Why can ETF inflows and foreign selling occur at the same time?

  • Citi’s tracking of local-market trading shows that foreign investors were net sellers of 15.5 billion US dollars in Taiwan last week, while South Korea recorded foreign net outflows of 2.7 billion US dollars. India and other ASEAN markets also continued to see foreign net outflows. Asian ETF subscriptions and local foreign-investor trading therefore diverged.
  • The two sets of data measure different stages: ETF flows record money entering or leaving funds, while foreign-investor trading records net purchases or sales by foreign investors in local markets. Taiwan ETF inflows of 6.9 billion US dollars and foreign net selling of 15.5 billion US dollars should be understood separately; subtracting one directly from the other would mix different statistical measures.
  • The report’s ‘estimated flows into equity markets’ have another meaning: Citi multiplies the flows for a category of funds by that category’s allocation to a given market. This measures the change in market exposure implied by subscriptions and redemptions according to allocation weights; it and local foreign-investor net buying or selling serve different purposes.

Are global investors all increasing their positions at the same time?

  • In the same week, global equity funds recorded net inflows of 55.6 billion US dollars and bond funds recorded net inflows of 12.1 billion US dollars, with equity funds attracting more. Equity funds investing globally continued to receive inflows of 9.5 billion US dollars.
  • But there was still a clear divergence between fund types: US ETFs attracted 16.2 billion US dollars, while non-ETF products saw redemptions of 9.5 billion US dollars. Total equity flows were positive, while non-ETF products still faced outflows.
  • Regional performance also differed. Western European equity funds saw net redemptions of 1 billion US dollars; ETF inflows of 900 million US dollars were offset by outflows of 1.9 billion US dollars from non-ETF products. Increased global inflows were accompanied by choices among products and regions, rather than subscriptions across all fund types.