Interactive Investor

The top 10 most-purchased ETFs in July 2023

1st August 2023 12:31

by Sam Benstead from interactive investor

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Investors reacted to rising markets by buying ETFs that tracked large companies globally, and in the US and UK. 

Most-popular ETFs 600

Exchange-traded funds (ETFs) tracking the main UK, global and US stock market indices rose up the ranks in July, as shares rallied on the back of promising inflation data.

In July, including dividends and measured in sterling, the FTSE 100 rose 2.3%, the MSCI World index rose 2.13%, and the S&P 500 rose 1.96%.

This was a response to better-than-expected inflation numbers in the UK and US, which will alleviate pressure on central banks and could lead to less restrictive interest rates, which is good news for stock markets and economies.

The iShares Core FTSE 100 Ucits ETF rose one place to second in the most-bought ETF list, while the Vanguard FTSE All-World Ucits ETF advanced one place to third, and the Vanguard FTSE 100 Ucits ETF (distributing) rose one place to eighth. The iShares Core S&P 500 Ucits ETF was a new entry in ninth place.

The most-bought ETF, unchanged, was the Vanguard S&P 500 UCITS ETF (distributing). Its sister ETF, Vanguard S&P 500 ETF (accumulation), which reinvests dividends, was also unchanged in fifth place.

Dropping down the list was the iShares Core MSCI World Ucits ETF, which moved from second to fourth place in the most-bought ETF list for July.

Two other themes among ETF buyers stand out: the revival of technology stocks and the appeal of cash-like returns.

The Invesco EQQQ NASDAQ-100 ETF held on to seventh place after entering the top 10 in May this year. The ETF tracks the 100 largest companies listed on the Nasdaq and is often taken as a proxy for the performance of US tech shares in general.

It is enjoying a very strong period (up more than 35% in 2023) thanks to breakthroughs in artificial intelligence technology. The rally has been driven by the largest stocks in the index, such as Apple and Microsoft, which prompted index group Nasdaq to cut its weightings to the largest shares, a change which took effect last week.

Lyxor Smart Overnight Return ETF, in sixth place, is actively managed and invests in a diversified portfolio of financial instruments and repurchase agreements in order to deliver a cash-like return. Cash-equivalent investments have risen in value over the past two years due to higher interest rates.

Rounding off the most-bought list was the Wisdom Tree Nasdaq 100 3x Daily Short ETF, a leveraged ETF that intends to move in the opposite direction to the Nasdaq 100 index.

It is therefore much more riskier than a normal ETF. The promotional literature of many leveraged products specifies that they should not be held for more than one day, and our article explains why in more detail.

Dropping off the list in July was the iShares Physical Gold ETC.

Top 10 most-popular ETFs in July 2023 

PositionETFChange on last monthOne-year performance (%)Three-year performance (%)
1Vanguard S&P 500 UCITS ETFNo change6.448.5
2iShares Core FTSE 100 Ucits ETFUp one7.645
3Vanguard FTSE All-World Ucits ETFUp one6.637.1
4iShares Core MSCI World Ucits ETFDown two7.242.1
5Vanguard S&P 500 ETFNo change6.448.5
6Lyxor Smart Overnight return ETFNo change3.54.2
7Invesco Nasdaq 100 Ucits ETFNo change15.649.1
8Vanguard FTSE 100 Ucits ETF (distributing)Up one7.645
9iShares Core S&P 500 Ucits ETFNew entry6.448.6
10Wisdom Tree Nasdaq 100 3x Daily Short ETFNo change-58.7-88.1

Source: FE FundInfo/interactive investor, 1 August. Note: the top 10 is based on the number of “buys” during the month of July. 

These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

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