Despite the availability of thousands of different exchange-traded funds (ETFs), many investors focus on a relatively small number of popular options. While there is nothing wrong with a broad-based S&P 500 fund or a targeted Nasdaq-100 fund—and indeed these ETFs often provide some of the most robust returns when the broader stock world is thriving—there are opportunities for more adventurous investors to find alternatives that can provide compelling momentum, strong dividends, and value.
One way investors can monitor which of the many unorthodox ETFs may be best for them is by watching fund inflows. This measure of the net purchase of ETF shares is one type of indicator for where investors are focusing their assets. Looking at funds with sizable inflows over a recent period can show which corners of the ETF space are trending.
