Active ETFs are firmly in the mainstream and set for further growth, but advisers are putting greater emphasis on value, liquidity and structural fit when deciding which products earn a place in portfolios, according to a survey of 450 advisers across the US and Europe by MSCI Inc. (NYSE: MSCI).
The vast majority of respondents (87 per cent) to the ETF Intelligence Survey 2026 already invest in active ETFs and 71 per cent expect to increase their use over the next two years. Passive ETF use is also set to grow, with 62 per cent of advisers planning to increase their allocation. More significantly for asset managers, 58 per cent say a new active ETF allocation from a manager they already use would most likely displace an existing mutual fund or UCITS holding.
A change in structure doesn’t necessarily mean a change in manager, however, with half of respondents likely to switch to an active ETF version of a strategy they already hold and 85 per cent of those involved in fund selection open to an ETF share class of the same strategy.
Looking ahead, advisers want greater choice across strategies and exposures with thematic and megatrend ETFs drawing the strongest demand (47 per cent). At the same time, 45 per cent of respondents expect to broaden their equity allocations beyond their home markets over the next two years. Among these respondents, 39 per cent expect a greater focus on emerging markets compared with 24 per cent on developed markets.
The majority (58 per cent) of respondents would pay more for a difficult-to-access strategy whereas only 12 per cent would pay a higher fee for core beta. Liquidity and the ability to trade efficiently also rank among the top priorities for 68 per cent of respondents, a sign that advisers are weighing what an ETF costs to use alongside what it costs to own.
As ETFs stretch across more strategies and asset classes, the question of fit becomes more important. While nearly half (49 per cent) of responding advisers are open to accessing private or less liquid assets through an ETF, only 16 per cent consider private markets a good fit for the structure. Nearly two-thirds (62 per cent) point to a mismatch between the liquidity of the ETF and its underlying assets as the main reason, ahead of valuation transparency (50 per cent) and a lack of track record (44 per cent).
“Passive ETFs remain the foundation of most adviser portfolios, but active ETFs are increasingly becoming mainstream. What we are seeing is a shift from whether advisers will use active ETFs to where the structure delivers the most value,” says Jana Haines, Global Head of Index at MSCI. “As the ETF market enters a more mature phase, advisers are also asking harder questions about the product’s fit. The opportunity lies not just in providing more choice, but in knowing where the structure adds value, where its limits lie and what it takes to earn a place in the portfolio.”
