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Institutional Holdings Analysis of Financial ETFs

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Institutional investors lower holdings in XLF in 2Q15

In 2Q15, 13F filings of major institutional asset managers gave a mixed picture for the Financial Select Sector SPDR ETF (XLF). The top five institutions added XLF to their portfolios. Although trade activity among 13F filers displayed a 3.87% reduction in aggregate shares held by institutional investors and hedge funds in XLF, large asset managers increased exposure to the ETF.

Major institutional holders such as Morgan Stanley (MS), Citigroup (C), and Goldman Sachs (GS) have increased their exposure to XLF. Blackrock (BLK), UBS AG, and JPMorgan Chase have significantly reduced their exposure. In fact, Partner Fund Management has liquidated all its exposure to XLF. This trend may be a result of negative global sentiment arising from emerging market economies and a slowing Chinese economy.

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Institutional holdings in VFH

In 2Q15, trading activity among 13F filers displayed a 31.23% increase in aggregate shares held by institutional investors and hedge funds in the Vanguard Financials ETF (VFH). While 23 funds created new positions in VFH, 50 funds added exposure to the ETF. However, in 2Q15, five funds liquidated their exposure to VFH.

Among the largest asset managers adding exposure to VFH were Morgan Stanley and Goodman & Company. Bank of America reduced its exposure to the fund.

Institutional holdings in IYF decline in 2Q15

Aggregate shares of the iShares US Financials Sector ETF (IYF) held by institutional investors and hedge funds increased 31.98% in 2Q15. While 34 funds created new positions of IYF, ten funds liquidated all their exposure to this fund.

Large institutions to increase exposure to IYF are Beaumont Financial Partners and AssetMark.

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