Investors Ditch Growth for Value ETFs in February

February ETF Flows Highlights

• ProShares Genius Money Market ETF IQMM debuted with $18 billion, making it the first money market ETF to comply with the Genius Act.
• Investors continued to look abroad, adding $52 billion to international-equity ETFs and outpacing US equity flows for the second straight month.
• Growth fell out of favor as large-growth ETFs suffered their first outflow since January 2023. They bled $5 billion, while large-value ETFs collected $17 billion.
• Vanguard dominated ETF provider flows with $58 billion, nearly $20 billion ahead of iShares.
• Investors embraced active management at a record clip, pouring $69 billion into active ETFs, or nearly 39% of all flows.

Investors piled $180 billion into US exchange-traded funds in February, following January’s record $157 billion start to the year. February’s inflows were more than any single year’s flow from 1993 through 2011. The first two months of 2026 have exceeded the first 14 years of US ETF flows combined.

The table below shows February returns for a sample of Morningstar analyst-rated ETFs that represent major sections of the stock and bond markets.

A Money Market ETF Tops the Charts

An unusual fund topped the charts for net inflows. ProShares Genius Money Market ETF launched in mid-February and immediately attracted roughly $18 billion. ProShares ETFs hold about two-thirds of that as a cash position in their portfolios, and investors in those funds aren’t double-dipping on fees.

What’s so special about this money market ETF?

ProShares Genius Money Market ETF is the first money market ETF built to comply with the Genius Act, which was signed into law in July 2025 and requires stablecoin issuers to completely back their tokens with high-quality liquid assets like US Treasuries. Stablecoins are digital tokens pegged to a currency, usually the US dollar, and used primarily for payments and settlement in the cryptocurrency ecosystem. Crypto trades 24/7, and these stablecoins allow for near-instant settlement. The Genius Act is expected to be effective in late 2026 or early 2027, and stablecoin issuers will be able to use this ETF to back their tokens.

International Stocks Steal the Show Again

International-equity ETFs pulled in $52 billion in February, outpacing US equity’s $33 billion by a wide margin. It’s the second straight month that international outshone domestic equities and is a continuation of the trend that defined 2025, when international ETFs shattered their annual investing record.

Both developed- and emerging-market stocks outperformed US stocks in February, as represented by our analyst-rated ETFs above. Foreign large blend and diversified emerging-market ETFs benefited the most from the trend, collectively pulling in roughly $30 billion in new money. Diversified Pacific/Asia was the only subcategory with outflows, driven solely by money fleeing Vanguard FTSE Pacific ETF VPL.

Vanguard Total International Stock ETF VXUS was the top international ETF by inflows, drawing in over $5 billion. One standout was iShares MSCI South Korea ETF EWY, which collected $3 billion. South Korean stocks have rallied on the back of chip demand and governance reforms.

Value Trounces Growth in February

Investors favored value ETFs over their growth counterparts in February, a sharp reversal from the previous month. Large-value ETFs gathered $17 billion while large-growth ETFs bled $5 billion. That’s the first time that large growth suffered outflows since January 2023. The trend hit Invesco QQQ Trust QQQ the hardest, with investors pulling over $7 billion from the tech-focused ETF. That coincides with poor February performance in the category, including Invesco QQQ’s 2.3% decline.

Value ETFs, on the other hand, performed relatively well. Large-value ETFs collected roughly $17 billion in fresh capital, which was their best month of flows on record. Vanguard Value ETF VTV and Schwab U.S. Dividend Equity ETF SCHD earned the highest inflows and have returned roughly 8% and 16% for the year to date, respectively.

Invesco S&P 500 Equal Weight ETF RSP had its day, with a record $6 billion in February inflows. RSP spreads its portfolio evenly across all stocks in the S&P 500, which helps avoid the market’s heavy concentration in a handful of stocks. It performed well for the year to date through February, too, returning 7%. However, investors should keep in mind that the ETF has underperformed the S&P 500 over longer stretches and requires more trading costs to rebalance its portfolio.

Vanguard Chases iShares

Vanguard outpaced all ETF providers with $58 billion of inflows in February, extending its year-to-date flows to $108 billion—nearly double iShares’ $59 billion. Vanguard has historically started the year faster than its rivals, a pattern that continued in January and only accelerated in February.

IShares gathered a solid $40 billion, while State Street was the only top-10 provider to post outflows, shedding $1 billion, largely driven by State Street SPDR S&P 500 ETF SPY. State Street and iShares typically have their weakest flows in the first quarter, unlike Vanguard.

Gold ETFs Stay in Vogue

Commodities-focused ETFs pulled in about $8 billion in February, with gold ETFs leading the way. SPDR Gold Shares GLD collected over $2 billion, bringing its year-to-date haul to nearly $6 billion. Gold prices have continued their upward march, despite faltering for a moment in late January. Investors have also increasingly used gold as a hedge against economic uncertainty and a weakening US dollar.

The sector-equity group was a notable positive in February, pulling in $12 billion. Industrials sector ETFs led the charge, gathering $5 billion in fresh capital, marking a shift from the technology sector, which has been dominant over the past three years. This could signal that investors see potential in the buildout of artificial intelligence infrastructure. Outflows of $5 billion hit financials sector ETFs, coinciding with poor February performance in that category.

Active ETFs Break a Short-Lived Record

Active ETFs obliterated their previous monthly record with $69 billion of inflows in February, surging past January’s $57 billion. That’s nearly 39% of all ETF inflows for the month—a share that continues to creep higher year over year.

Active strategies from J.P. Morgan, Dimensional, and Capital Group were among the biggest beneficiaries. Active bond ETFs continued to attract strong interest as well, as active managers have historically had more of an edge in fixed income, where the market isn’t as efficient as in equities.