Actively managed exchange-traded funds are growing much more quickly than traditional ETFs. They grew at a 14 per cent organic rate in the first half of the year, while passive ETFs grew only 3 per cent, according to Morningstar’s Global Fund Flows report for H1 2023.
Other findings include:
- Global long-term mutual funds and ETFs had USD54 billion of inflows in the first half of 2023, but fixed-income funds accounted for the entire intake. The category’s USD236 billion inflow made up for the other groups’ outflows.
- Actively managed ETFs continue to outpace passively managed ETFs in H1 2023.
- ETFs enjoyed their 113th straight month of inflows in June. Open-end funds had inflows for the month but had outflows in 16 of the previous 17 months.
- Indexed strategies now represent 39 per cent of assets globally, or USD16.2 trillion.
- Among the largest fund groups, JP Morgan posted the highest organic growth rate (5.6 per cent) by far, while iShares (USD66 billion) beat out Vanguard (USD59 billion) in absolute terms.
- The top 10 fund groups by assets are headquartered in the US. Many of them have succeeded in diversifying across markets, using their lower costs to scale their efforts and win over investors.