Equity mutual funds were seeing hefty outflows even before the recent market pullback. Some analysts think changing demographics are fueling the growth of ETFs and continued outflows from stock mutual funds.

Through the first half of April, about $14.7 billion flowed out of U.S. equity mutual funds, the first April since the 2008 recession that has not experienced healthy inflows, writes Nicholas Colas, Chief Market Strategist at ConvergEx, in a research note. Meanwhile, U.S.-listed equity ETFs brought in $443 million during the period. [ETFs or Mutual Funds: Why Not Both?]

“Yes, many months have seen large scale redemptions from mutual fund, but April has historically been a good one,” Colas said.

“When I asked one of my contacts about why he thought that mutual funds were losing assets even as U.S. stocks continued to rise, he wondered aloud if it could be demographic in nature. The idea is that mutual fund owners have likely owned these products since the 1980s and 1990s, when the industry was growing quickly. ETFs, in contrast, are a newer innovation and perhaps therefore used by younger retail investors,” the strategist wrote. [Fund Investors Smarten Up on ETF Benefits]

“By this theory, we will continue to see mutual fund redemptions for many years, regardless of overall stock market performance. The sales reflect the need for retiring Baby Boomers to move to fixed income investments as they seek to create income and reduce portfolio risk,” Colas added. “I would point out that not everyone we spoke to agreed that the mutual fund industry is demographically older than exchange traded funds, but it is an interesting perspective.”

ETFs are set for “literally trillions and trillions and trillions of future growth,” Jonathan Steinberg, founder & CEO of WisdomTree, said in a recent interview with Yahoo Finance. “The ETF is to the mutual fund, what the Internet is to the newspaper.” [Why ETFs Continue to Thrive]

Max Chen contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.