Investors Sank $53 Billion Into Stock ETFs in March Despite Market Volatility

Global stocks turned upside down in the first quarter. That was especially true in March, when many of the market’s recent superstars trailed the sectors, countries, and companies that have long flown under the radar.

Flows into stock exchange-traded funds did not perfectly mirror this market rotation. Changing market leadership did influence how investors bought and sold in March, though. US value funds collected more money than growth; technology and bitcoin ETFs faced outflows; and the Europe-stock category notched its best month to date, developments that prove the market can alter the shape of stock-ETF flows even if it can’t change them entirely.

This article examines last month’s stock ETF performance and flows. Bond ETF performance and flows sit in a separate article, which also details flows into nontraditional-stock ETFs, crypto ETFs, and the top ETF providers.

Stock ETF Performance: The Rotation Keeps Turning

Vanguard Total World Stock ETF VT shed 3.7% in March, its worst month since April 2024. Last month’s article pointed out that many of the market’s most popular trades in recent years started to unwind in February. That rang even truer in March.

International-Stock ETFs Stay Hot Behind Balanced Effort

Investors can’t blame foreign stocks for VT’s woes. Vanguard Total International Stock ETF VXUS scraped out a 0.4% gain in March to finish the first quarter 5.7% higher than where it started—10.5 percentage points better than Vanguard Total Stock Market ETF VTI

. The foreign-stock ETF had never beaten its US counterpart by that much, a stark turnaround after it trailed the US fund in 16 of the previous 20 quarters.

Eurozone stocks played a key role. IShares MSCI Eurozone ETF EZU rallied 1.6% in March and 12.8% on the quarter. Early in March, the incoming German chancellor announced plans to relax the borrowing limit, or debt brake, that had long kept a lid on the country’s finances. The news weighed on eurozone bonds but powered the euro and local stocks, most significantly those positioned to beef up its infrastructure and defense. IShares MSCI Germany ETF EWG returned 2.4% on the month.

India stocks helped propel VXUS into positive territory last month. IShares MSCI India ETF INDA climbed 7.3% in March after sinking 16.3% over the prior six months, bolstered by new foreign institutional investment and the weakening US dollar versus the Indian rupee. Elsewhere, the Morningstar China Index climbed 1.9% to finish the first quarter with a 14.1% gain; iShares MSCI Japan ETF EWJ was roughly flat in March and up 2.2% on the quarter. Neither of those countries dominated last month, but at nearly one fourth of VXUS combined, merely staying the course helped the ETF stay ahead.

US Stock ETFs Take a Wild Ride

VTI shed nearly 5.9% in March, its worst month since September 2022. Several factors punished US stocks, but the looming prospect of tariffs was the head of the snake. Concerns that tariffs would prompt inflation and economic stagnation dimmed consumer sentiment and cast a shadow over the US market.

Several of March’s worst sectors and stocks were last year’s top dogs. For instance, The Technology Select Sector SPDR ETF XLK and The Consumer Discretionary Select Sector SPDR ETF XLY each lost about 8.3% in March and between 11% and 12% in the first quarter. Amazon AMZN and Tesla TSLA spiraled more than 10% apiece in the consumer discretionary ETF (bringing Tesla down 44.2% since the start of 2025). Semiconductor companies like Nvidia and Broadcom both took a beating in the technology fund. Those firms—both of which blew past 100% returns in 2024—are down 19% and 26%, respectively, in 2025.

There were diamonds in the rough, though. The Energy Select Sector SPDR ETF XLE gained 5.3% in March to seal a 10% first-quarter return, tops among S&P 500 sectors. Utilities stocks scratched out positive returns. That was the only other S&P 500 sector in the black, but consumer staples and healthcare stocks lived up to their defensive reputations by losing less than 2%. Gravitating toward those sectors helped the defensive Invesco S&P 500 Low Volatility ETF SPLV deliver on its mandate. It advanced 0.4% in March and 7.2% in the first quarter—nearly 12 percentage points better than the S&P 500, its parent index.

Divergent sector performance trickled through value and growth ETFs. Vanguard Growth ETF VUG

, laden with tech, consumer discretionary, and communications stocks, shed 8.5% in March. Vanguard Value ETF VTV

held its return to negative 2.5%. It beat its growth twin by 12.2 percentage points in the first quarter. That marked VTV’s widest victory over VUG since the fourth quarter of 2022, when similar concerns about inflation, economic growth, and consumer sentiment plagued the headlines. VTV still has plenty of work to do, however: its 9.3% return in 2024 was roughly one fifth of VUG’s 46.8% mark.

US Stock ETF Flows

Not even a turbulent market could interrupt flows into US stock ETFs last month. Investors poured nearly $40 billion into them in March. Large-blend funds scooped up $21 billion. IShares Core S&P 500 ETF IVV paved the way with $21.8 billion of inflows, tops among all ETFs by far.

The large-value category hauled in more than $11 billion on the month, ahead of large-growth’s $6.4 billion take. Performance mattered; value indexes generally held up better than growth. Another key segment was dividend-oriented funds, many of which capably navigated the turmoil due to their sturdy holdings. Large-value ETFs labeled as dividend funds absorbed $3.6 billion in March, led by Schwab US Dividend Equity ETF’s SCHD $2-billion haul.

International-Stock ETF Flows

International-stock ETFs welcomed $13 billion in March and $28 billion in the first quarter. Foreign large-blend ETFs claimed $17 billion, or 62% of that pie. That said, the Europe-stock category jumped off the page in the first quarter. It reeled in $5.7 billion in March—its best month in exactly 10 years—to cap off an $8 billion first quarter. That translated into a remarkable 21% organic growth rate. Investors noted funds like Vanguard FTSE Europe ETF VGK, whose 10.7% first-quarter return earned it $2.4 billion of new money.

Nontraditional-Equity ETFs Outdo Themselves

The nontraditional-equity cohort raked in $21 billion in the first quarter—the fifth straight quarter it set a new inflow record. Nearly $16 billion of that bounty went to the derivative-income category, where stalwarts JPMorgan Nasdaq Equity Premium Income ETF JEPQ and JPMorgan Equity Premium Income ETF JEPI again led the pack. ETFs that write calls on individual companies like Coinbase COIN chimed in with nice inflows, too.

The defined-outcome category was no slouch. It gathered $4.4 billion in its own record-setting quarter. Most of these funds are built to protect investors from a specified percentage of the market’s downside—a proposition that practically pitched itself in during the first quarter.

Sector Equity ETFs Left Out in the Cold

Sector-equity ETFs bled $6.4 billion in March, their worst month since October 2023. Eleven of 16 Morningstar categories saw money leave, none more than consumer cyclical funds’ $2.1 net outflow. ETFs tied to the energy, communications, and technology sectors all finished with roughly $1 billion of outflows. Defensive sector ETFs fared better: the utilities category absorbed $1.2 billion, and consumer defensive took in nearly $500 million. Healthcare ETFs finished in the red, but its troubles seem systematic. It has endured outflows in eight straight months and 22 of the past 26.