In a continued shift towards diversification, US retail investors are pouring record amounts of money into international exchange-traded funds (ETFs) according to UBS’s market making clients. Despite a 18% decline in trading volumes compared to this year’s average, the monthly inflows for international ETFs have reached an all-time high of over $1 billion in February.

This trend is not limited to any particular sector, as broad selling was observed across all single-stock categories, with the exception of Internet & E-Commerce stocks which are on pace for multi-year monthly highs in inflows. This increased buying can be attributed to the growing popularity of online shopping and the dominance of industry giants like Amazon and Netflix.

The shift towards international investments is a strategic move by retail investors to diversify their portfolios and potentially benefit from economic growth in other regions. As global economies continue to recover from the COVID-19 pandemic, investors are looking for opportunities to expand their investment horizons beyond domestic markets.

While the US market has been a strong performer in recent years, investors are increasingly recognizing the value of diversifying their portfolios across different regions and asset classes. This trend is likely to continue as global economies continue to recover and investors seek to maximize returns in a low-interest rate environment.