High-frequency foreign portfolio flows into US and emerging-market assets Report Interpretation

Overview

Nomura's weekly flow tracker finds that foreign demand for US-focused equities remained solid in the five sessions through 11 September, while selling pressure in US-focused bond funds diminished sharply. The update also tracks stronger inflows to EM-focused ETFs, a reversal to net US-asset selling by Korean retail investors, and a near halt in Taiwan investors' purchases of USD-denominated bond ETFs.

Core views

Foreign inflows into US-focused equity ETFs and mutual funds totaled USD2.4bn between 7 and 11 September. This was below the USD3.1bn recorded in the preceding five sessions, but remained a substantial positive flow and kept month-to-date September equity inflows at USD4.9bn. The report contrasts this with USD10.7bn of inflows during August 2026, indicating that September demand remained positive but was running at a slower pace than the previous month. US-focused bond ETFs and mutual funds recorded a modest USD59mn foreign outflow during 7-11 September, compared with a USD634mn outflow in the prior week. The smaller weekly withdrawal means selling pressure eased materially. Month-to-date September bond-fund flows were slightly positive at USD11mn after USD1.0bn of outflows in August 2026, although the report characterizes the month-to-date inflow as small. Foreign flows into EM-focused ETFs strengthened to USD1.5bn from USD1.2bn in the previous week. The composition was notably equity-led: equity funds attracted USD1.7bn, while bond funds saw USD220mn of outflows. September month-to-date inflows into EM-focused funds reached USD1.9bn, following USD8.8bn of inflows in August 2026. The regional investor data showed weaker Korean retail demand for US assets. Korean retail investors net sold USD490mn of US portfolio assets during 7-11 September, reversing from USD410mn of net buying in the previous week. The weekly total comprised USD667mn of net sales of US equities and USD177mn of net purchases of US bonds. Korean retail investors remained net buyers by USD227mn month to date in September, but this was far below their USD3.8bn net purchases in August. Taiwan investors' flows into exchange-listed ETFs invested in USD-denominated bonds were almost zero during the latest week, following USD124mn of inflows in the prior week. Their September month-to-date net purchases were USD93mn, compared with USD476mn in August. Nomura bases its foreign-flow proxies for US-focused equity and bond funds on the assumption that funds listed on non-US exchanges are primarily held by non-US retail investors; its EM proxy similarly assumes that EM-focused funds listed in non-EM markets are primarily held by foreign investors.

Analysis framework

The report compares high-frequency weekly, month-to-date and prior-month flow data for US-focused equity and bond ETFs and mutual funds, EM-focused ETFs, Korean retail investment in US assets, and Taiwan-listed USD bond ETFs. It separates equity and bond flows where available and uses exchange-listing-based proxies to estimate foreign investor activity.

Methodology notes

• Other

  High-frequency investor-flow tracking using exchange-listing-based foreign-flow proxies

  Nomura estimates foreign flows by treating US-focused funds listed outside the United States as primarily owned by non-US retail investors, and EM-focused funds listed outside EM markets as primarily held by foreign investors. It then compares weekly, month-to-date and monthly flows.

Asset mapping & comparison

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

• US-focused equity ETFs and mutual funds

  Received continued foreign inflows

  Strengths

  USD2.4bn of inflows during 7-11 September and USD4.9bn month to date in September

  Weaknesses

  Weekly inflows slowed from USD3.1bn in the prior week

  Comparison

  August 2026 inflows were USD10.7bn

• US-focused bond ETFs and mutual funds

  Experienced reduced foreign outflows

  Strengths

  Weekly outflows narrowed to USD59mn and month-to-date September flows were USD11mn positive

  Weaknesses

  The latest weekly flow remained negative

  Comparison

  Outflows were USD634mn in the previous week and USD1.0bn in August 2026

• EM-focused ETFs

  Attracted stronger foreign inflows

  Strengths

  USD1.5bn of weekly inflows, led by USD1.7bn into equity funds

  Weaknesses

  Bond funds saw USD220mn of outflows

  Comparison

  Weekly inflows increased from USD1.2bn in the prior week

• Korean retail investment in US portfolio assets

  Turned to net selling

  Strengths

  US bond purchases totaled USD177mn during the week

  Weaknesses

  Net sales of US equities reached USD667mn

  Comparison

  The USD490mn net sale followed USD410mn of net buying in the previous week

Key data

• US-focused equity fund foreign inflowsUSD2.4bn7-11 September; versus USD3.1bn in the previous week
• US-focused bond fund foreign flows-USD59mn7-11 September; outflows narrowed from USD634mn in the previous week
• US-focused fund flows in SeptemberUSD4.9bnMonth to date, mainly driven by equity inflows
• EM-focused ETF inflowsUSD1.5bn7-11 September; versus USD1.2bn in the previous week
• Korean retail flows into US portfolio assets-USD490mn7-11 September; following USD410mn of net buying in the previous week
• Taiwan USD bond ETF flowsAlmost zero7-11 September; following USD124mn of inflows in the previous week

Impact & implications

The report's flow data indicate continued foreign appetite for US-focused equities and an easing of foreign withdrawals from US-focused bonds. EM ETF demand accelerated but remained concentrated in equity funds, while the Korean and Taiwanese investor indicators showed softer demand for US assets and USD-denominated bonds, respectively.