When it comes to the U.S. market in 2025, things have proven to be a tad bit more volatile than some experts may have expected.
Worse yet, market conditions don’t seem to be becoming less certain anytime soon. Escalating tariff threats and inflationary pressures are making it difficult to see what lies ahead. To top it all off, odds of the U.S. entering a recession this year are continuing to ebb and flow.
With all these factors in mind, many advisors and investors are still in the midst of reassessing their portfolio allocations. By examining where assets are flowing, one can gain a better understanding of which portfolio strategies are currently standing out.
Examining SPY's Fund Flows
The SPDR S&P 500 ETF Trust (SPY ) needs no introduction. As one of the largest ETFs in the world, SPY is a reliable vehicle for fostering access to the equity market. Due to its highly regarded status, SPY can also be viewed as a bellwether for how advisors are valuing the S&P 500 at the moment.
Fund flows data from FactSet helps illuminate how SPY’s advisor experience has shifted over the last month or so. During the month of March, SPY was negatively impacted as some investors moved out of equities.
However, these outflows may very well have occurred for reasons outside of the fund’s control. When the U.S. market became especially roiled, advisors may have looked to pivot from equities to more risk-averse assets. This could include “safe havens” like bonds or cash strategies, or international equities with low correlation to the United States.
Why SPY Still Stands Tall
Despite the dour outlook on equities, SPY’s distinct benefits helped the fund quickly shift back into favor. As FactSet’s data shows, SPY has seen well over $19 billion in inflows since April 7, 2025.
These tremendous inflows can illustrate a lot of benefits of both SPY and the ETF ecosystem as a whole. To start, SPY continues to be used as one of the most tried-and-true ETFs for building large-cap exposure.
“SPY operates in an ecosystem unparalleled by any other ETF,” said Matt Bartolini, head of Americas ETF Research at State Street Global Advisors. “Over the past decade, SPY has accounted for nearly 25% of all US ETF trading volume, and in periods of significant market volatility like last week, SPY’s trading volume spikes even higher as investors turn to the fund for its unmatched liquidity during times of market stress. In short, SPY helps investors get in and out of the market and continues to be the tool for action when volatility spikes.”
Turning to ETFs During Market Volatility
It’s no accident that SPY is among the top ETFs in terms of trading volume. The fund has a proven track record that taps into State Street’s decades of market experience. Given this resurgence in macroeconomic uncertainty, advisors can use SPY’s experienced portfolio team and compelling liquidity to stay engaged with the equity market.
However, not all the ETFs with high trading volume are stable, reliable funds like SPY. The list also includes a variety of single-stock funds, thematic plays, and other interesting selections.
It would take quite a while to sort through all these funds and illuminate why they are seeing such strong trade volume. However, looking at the big picture, one can see how advisors are turning to ETFs as a potential solution for periods of volatility.
For advisors, ETFs can provide a tax-advantageous means to access a variety of compelling strategies and asset managers. This includes index ETFs, active managers, and everything in between.
Looking ahead, it’s difficult to forecast where the market could go next. However, strong trading volume from funds like SPY showcases how advisors will continue to turn to ETFs to construct a portfolio capable of navigating any potential market volatility.
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