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November ETF Scoreboard

NEW YORK ( TheStreet) - The National Stock Exchange released its ETF flow data for the month of November and, as expected, the information unveiled a number of interesting trends within the exchange traded fund universe.

In November, the total number of ETFs available increased to 1,092 from 1,066 in October. On a year over year basis, ETF assets increased by $947 billion; this amounted to a 25% gain.

Among the major fund sponsors, Vanguard continued its assault on industry veterans. The pioneer of low-cost index mutual funds gained ground on its ETF competitors, evidenced by the nearly $7 billion in inflows.

BlackRock (BLK) saw money flow in as well, totaling approximately $1.3 billion. State Street (SST) and PowerShares took the biggest hits, seeing nearly $500 million and $250 million flow out of their funds respectively.

Although big names in the ETF industry are increasingly becoming one-stop-shops for investors, smaller, boutique ETF providers are still holding strong. Van Eck, WisdomTree, and ETF Securities saw the largest net inflows, totaling $730 million, $490 million, and $380 million respectively. Global X, which has seen an uptick in notoriety recently, saw respectable inflows as well, totaling $250 million.

Bond giant and relative newcomer to the ETF arena, Pimco, also saw a respectable uptick in assets, totaling $500 million in assets. This is largely thanks to the success of the Pimco Enhanced Short Maturity ETF (MINT), with $400 million in inflows.

The Vanguard Emerging Market ETF (VWO) saw the largest inflows across the industry, totaling $1.7 billion. On the opposite side of the spectrum, SPDR S&P 500 ETF (SPY) took the biggest hit, as nearly $2 billion headed for the exits.

The performance of both VWO and SPY highlight the influence of the ongoing price war which has been raging in the ETF arena, threatening funds which have long held dominance over the industry. VWO's nearest competitor, the elder, albeit more expensive, iShares MSCI Emerging Market Index Fund (EEM) saw heavy outflows during Nov, totaling a loss of $620 million. Vanguard's relatively new SPY competitor, the Vanguard S&P 500 ETF (VOO) saw $24 million flow into the fund.

One of the most noticeable instances of the ongoing price wars could be seen in the battle between physically-based gold funds. In early 2010, BlackRock drastically reduced the expenses attached to the iShares Gold Trust (IAU) in hopes of stealing away market share from industry leader SPDR Gold Shares (GLD). So far, the move appears to be having an effect. In November, GLD saw $270 million head for the exits while IAU saw its assets increase by over $200 million.

The gold ETF showdown continues to draw a crowd but it was silver that took center stage in Nov. The physically-based industry leader iShares Silver Trust (SLV) drew in some of the largest flows across the entire industry, totaling $520 million.

Although broad based funds such as SPY, PowerShares QQQ (QQQQ) and SPDR Dow Jones Industrial Average ETF (DIA) saw noticeable outflows in November, a number of sector specific U.S. equity ETFs were major recipients of inflows during the month.

Consumer Discretionary Select Sector SPDR (XLY), Industrial Select Sector SPDR (XLI), Energy Select Sector SPDR (XLE) and SPDR KBW Bank ETF (KBE) were among the top 15 inflow recipients.

One aspect of the ETF universe I have maintained a close watch on over the past few months has been the growing popularity of volatility-linked products. Although I have consistently urged long term investors to avoid them, as economic turmoil continues to rage across many regions of the globe, VIX-linked products, including the iPath S&P 500 VIX Short Term Futures ETN (VXX), have generated an impressive following.

In November, however, VXX and its sister fund, the iPath S&P 500 VIX Mid-Term Futures ETN (VXZ) went in opposite directions. VXZ saw over $100 million in inflows, while nearly $400 million left VXX.

Many of the trends seen in Nov have persisted throughout 2010 and will likely continue into the New Year. As we head closer towards the end of the year, it will be interesting to see what new trends develop as well.

Written by Don Dion in Williamstown, Mass.

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At the time of publication, Dion Money Management was long iShares Gold Trust and PowerShares QQQ.

This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

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