Worldwide listed actively-managed Exchange-Traded Funds (ETFs) surpass a milestone of $1.48 trillion in assets under management.

Worldwide listed actively-managed Exchange-Traded Funds (ETFs) surpass a milestone of $1.48 trillion in assets under management.

Investors worldwide are flocking to actively managed Exchange-Traded Funds (ETFs), as the industry reached an unprecedented milestone of US$1.48 trillion at the end of June 2025. This significant growth, marking the 63rd consecutive month of net inflows into actively managed ETFs, is attributed to a combination of factors that have made these investment vehicles more attractive than ever.

Substantial inflows can be attributed to the top 20 active ETFs by net new assets, which collectively gathered $19.70 billion during June. JPMorgan Mortgage-Backed Securities ETF (JMTG US) led the pack with the largest individual net inflow of $5.78 billion. For the year to date, equity focused ETFs have brought in $148.98 billion in net inflows, a notable increase from the $89.35 billion in net inflows YTD in 2024.

The industry's growth can be attributed to several key factors. Innovation and product diversification have made active ETFs more appealing, offering specialized strategies like profitability or low volatility factors, which appeal to investors seeking differentiated returns. The use of rules-based and quantitative strategies has narrowed the cost gap between active and passive options, making active ETFs more competitive.

Regulatory changes have also played a significant role in the industry's growth. The SEC's 2019 Rule 6c-11 has allowed active ETFs to use derivatives and engage in market-making more freely, reducing operational costs and complexity. This regulatory change has enabled firms to launch low-cost active bond ETFs, targeting yield-hungry investors in a low-interest-rate environment.

The shift in investor sentiment is another contributing factor. The rise of active ETFs reflects a broader reevaluation of traditional passive strategies in a low-fee, high-competition environment. Investors are increasingly seeking active management for potential alpha generation without the high costs of traditional mutual funds.

Active ETFs are experiencing rapid growth outside the U.S., particularly in the Asia-Pacific and European regions, driven by regulatory shifts and growing investor demand. The broader ETF market has grown significantly, reaching over $10 trillion in AUM in the U.S. alone by early 2025, with active ETFs capturing a significant portion of net inflows.

The cost efficiency and flexibility offered by active ETFs are crucial in attracting investors who seek flexibility and cost savings. Active fixed income ETFs have seen significant growth, and structured products like covered call ETFs are gaining traction for income generation and downside protection—features that passive ETFs often cannot replicate. For the year to date, fixed income focused ETFs have brought in $102.60 billion in net inflows, a significant increase from the $54.49 billion in net inflows YTD in 2024.

As of the end of June 2025, there were 3,805 actively managed ETFs listed globally, with a total assets of $1.48 trillion, and 4,942 listings. This record surpasses the previous record of $1.39 trillion set in May 2025. Year-to-date net inflows for the industry reached a record US$267.02 billion in June 2025.

In conclusion, the growth of actively managed ETFs is a global phenomenon driven by innovation, regulatory changes, shifting investor sentiment, global growth and adoption, cost efficiency, and flexibility. As these factors continue to drive growth, investors can expect to see even more diverse and competitive offerings in the active ETF market.

Investors are appreciating the variety offered by actively managed ETFs, with the top 20 active ETFs amassing $19.70 billion in June 2025, illustrating considerable investing interest. Innovation and product diversification have fostered the appeal of active ETFs, producing specialized strategies that promise differentiated returns to investors.

The increased adoption of rules-based and quantitative strategies in active ETFs has helped bridge the cost gap with passive options, thereby encouraging more investors to invest. Regulatory changes, such as the SEC's Rule 6c-11 in 2019, have played a crucial role in reducing operational costs and complexity, allowing for the creation of low-cost active bond ETFs.

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