Charles Schwab Outlines the ETF Success Story

The ETF universe continues to expand at an fast clip as more investors turn to the cheap, easy-to-use investment vehicle to access various market segments.

“We continue to see ETFs grow, grow, grow, and it’s not surprising,” Heather Fischer, Vice President of the ETF & Mutual Fund Platforms at Charles Schwab, said at the recent Morningstar ETF Conference. “We recently did our annual ETF investor study, and the results tell us that they have long been interested in ETFs and that enthusiasm continues.”

When Charles Schwab first asked investors five or six years ago, respondents said 16% of their portfolios were in ETFs. The number has risen to 27% this year, and in five years, investors are predicting 33% of their portfolios will be made up of ETFs.

“So it’s a continued powerful high trajectory,” Fischer said.

Various investor demographics also show varying preferences for ETF usage. Across the broader investment groups, around 40% say they will utilize ETFs, but for millennials in particular, 60% to 65% say they like incorporating ETFs into their investment portfolios.