Overseas flows into US stock funds in June rose to the highest level since January 2025

Overview

This report is a weekly high-frequency investor flow tracking note from Nomura Asia FX Strategy, focusing on overseas investor flows into US stock and bond funds, emerging markets ETFs, and changes in Korean and Taiwanese investor allocations to US securities and USD bond products. The core conclusion is that US stock fund flows clearly strengthened, reaching a new monthly high for over a year in June; however, US bond funds and Taiwan USD bond ETFs showed notable outflows, indicating that cross-asset risk appetite is not evenly distributed.

Core views

The report argues that US equity assets continue to receive overseas fund support. In June, overseas inflows into US stock ETFs and mutual funds were USD13.8bn, the highest since January 2025; and from June 26 to July 2, flows continued at USD3.8bn. By contrast, US bond funds outflowed USD1.7bn in that same week, with total June outflows at USD2.7bn. Emerging markets ETFs remained net inflows, but weekly momentum slowed from the prior week's USD1.8bn to USD246mn. Taiwanese investors shifted to heavy net selling in USD bond ETFs, and Korean retail investors' net buying of US basket assets in June was also weak.

Analysis framework

The report uses a high-frequency flow framework, comparing ETF and mutual fund inflows and outflows for different regions and asset classes on both weekly (five trading days) and monthly bases, and combines that with regional investor behavior from Korean retail investors and Taiwan local ETFs to observe cross-border allocation direction.

Methodology notes

• Flow trackingHigh-frequency ETF and mutual fund flow monitoring

  Overseas investor allocation to US assets is proxied using funds that are listed or registered outside the US but invest in US assets.

  The report assumes that US equity and bond funds listed or registered outside the US are mainly held by non-US retail and institutional investors, and therefore can be used to track changes in overseas allocations to US securities.

• Regional investor behaviorKorean retail and Taiwan ETF flow monitoring

  Use trading in US securities by Korean retail investors and Taiwan local USD bond ETF flows to observe Asian investor USD-asset allocation.

  This approach can capture marginal demand shifts for US equities, US bonds, and USD bond products among Asian investors, but it is not equivalent to total market-wide cross-border flows.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• US stock ETFs and mutual funds

  Primary inbound direction for overseas funds

  Strengths

  USD13.8bn flowed in during June, with continued weekly expansion, indicating relatively strong demand.

  Weaknesses

  The report notes recent weakness in AI-related equities, so future momentum may be affected by market style shifts.

  Comparison

  June inflows were higher than USD8.8bn in May and the highest since January 2025.

  Risks

  If US equities correct or AI-related assets continue to weaken, inflows may decelerate.

• US bond ETFs and mutual funds

  Primary outflow direction for overseas funds

  Strengths

  They still have allocation characteristics as defensive or yield assets, but period data did not show fund support.

  Weaknesses

  Weekly outflow of USD1.7bn and June outflow of USD2.7bn.

  Comparison

  June outflows were the highest monthly outflow since April 2025.

  Risks

  Interest-rate volatility, USD moves, or credit spread changes may continue to affect bond flows.

• Emerging markets ETFs

  Still net inflows, but momentum is slowing

  Strengths

  Net inflows of USD3.1bn in June, above May's USD2.5bn.

  Weaknesses

  Latest weekly inflow fell from the prior week's USD1.8bn to USD246mn.

  Comparison

  June inflows were mainly from emerging market equity funds of USD2.3bn.

  Risks

  A global decline in risk appetite or a stronger USD could suppress emerging market flows.

• Taiwan-listed USD bond ETFs

  A window into weakening USD bond allocation by Asian investors

  Strengths

  Historically reflects local investor demand for USD bonds.

  Weaknesses

  Latest weekly outflow of USD975mn, and June total outflow of USD2.1bn.

  Comparison

  The prior week still had a small net inflow of USD61mn; June outflows were the highest in more than two years.

  Risks

  If USD bond yields, FX expectations, or local demand preferences continue to shift, outflows may persist.

• Korean retail investors' US basket assets

  Indicator of Asian retail risk appetite

  Strengths

  Net bought USD466mn in June, partially reversing May's net sell of USD568mn.

  Weaknesses

  Latest weekly net buying was only USD21mn, indicating weak momentum.

  Comparison

  Within the week, inflows into US equities (USD160mn) versus outflows of US bonds (USD139mn) were both divergent.

  Risks

  Retail flows are sensitive to market volatility and can reverse quickly.

Key data

• Overseas weekly inflow into US stock fundsUSD3.8bnObservation window is June 26 to July 2, 2026; the prior week was USD1.5bn.
• Overseas inflow into US stock funds in JuneUSD13.8bnThe highest since USD16.1bn in January 2025.
• Overseas weekly outflow from US bond funds-USD1.7bnObservation window is June 26 to July 2, 2026; prior week outflow was USD132mn.
• Overseas outflow from US bond funds in June-USD2.7bnThe highest monthly outflow since April 2025.
• Weekly inflow into emerging markets ETFsUSD246mnA clear slowdown from the prior week's USD1.8bn.
• June inflow into emerging markets ETFsUSD3.1bnMainly driven by USD2.3bn inflows into emerging market equity funds, above May's USD2.5bn.
• Weekly net buying of US basket assets by Korean retail investorsUSD21mnFrom June 27 to July 3, approximately USD160mn of US equities were bought and USD139mn of US bonds were sold.
• Weekly outflow from Taiwan USD bond ETFs-USD975mnFrom June 26 to July 2, turned from prior-week net inflow of USD61mn to a heavy outflow.
• June outflow from Taiwan USD bond ETFs-USD2.1bnHighest outflow in more than two years.

Impact & implications

Flow support for US equities remains relatively strong and may continue to provide marginal support for US equity risk assets; however, outflows from bond funds and Taiwan USD bond ETFs indicate weakening demand in fixed income, with regional investor behavior becoming more divergent. For FX and cross-asset allocation, it is important to monitor whether US equity flows remain sustained and whether bond outflows reflect pressure from rates, exchange rates, or risk appetite.

Risks

• US stock inflows are highly sensitive to risk appetite; if US equities or AI-related segments weaken, inflows may slow.
• Outflows from US bond funds and Taiwan USD bond ETFs may reflect pressure from rates, FX, or credit markets.
• The slowdown in weekly emerging markets ETF inflows suggests marginal weakening in flow momentum.
• Flow proxies based on fund listing venue and investor structure assumptions may not fully represent all cross-border capital movements.
• The report is a high-frequency flow update and does not constitute buy/sell recommendations for individual stocks or single assets.

What to watch

• Whether overseas inflows into US stock funds in the coming weeks sustain June's strength.
• Whether outflows from US bond funds expand, especially amid rate and USD volatility.
• Whether emerging markets ETF inflows can re-accelerate or cool further.
• Whether outflows from Taiwan USD bond ETFs persist, and whether they reflect a shift in Asian investors' USD bond allocation preferences.
• Whether Korean retail investors continue to buy US equities and sell US bonds.