Fund managers have also recently taken an overweight position to the financial sector after the Federal Reserve began raising interest rates. ETF investors can also capitalize on the shift in monetary policies through diversified financial sector plays, such as the iShares U.S. Financials ETF (NYSEArca: IYF), Financial Select Sector SPDR (NYSEArca: XLF) and Vanguard Financials ETF (NYSEArca: VFH). [Financial ETFs Poised to Strengthen]

While active funds continue to underperform benchmarks, overall asset flows in the fund industry also shows that investors are growing more amenable to the ETF investment vehicle. According to Bank of America Merrill Lynch, investors funneled $198.8 billion into global equity ETFs this year and pulled $177.2 billion from mutual funds. Nevertheless, mutual funds still make up the larger portion of the investment industry with $13.2 trillion in assets under management, but ETFs have eaten away at mutual funds’ market share, accumulating about $2.15 trillion in assets.

For more information on the fund industry, visit our mutual funds category.

Max Chen contributed to this article.

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