The ETF industry reached a major milestone this week.
Assets in US ETFs have crossed $10 trillion for the first time, according to Bloomberg data. ETFs have increasingly taken market share from mutual funds due to the structure’s ability to offer lower costs, enhanced liquidity, and better tax efficiency.
“ETFs continue to gain traction as advisors see the typically low cost, tax efficient, and precise exposure benefits,” Todd Rosenbluth, head of research at VettaFi, said.
Rosenbluth said it has been particularly great to see the adoption of newer strategies this year like active equity, crypto, and CLOs. The pendulum of assets flowing into ETFs is not swinging back but the need for education remains strong, he added.
“Milestones are a great time to assess impact, and $10 trillion in US-listed ETFs tell us that the ETF vehicle has had a big impact on the way we invest today,” Cinthia Murphy, investment strategist at VettaFi, said.
ETFs have empowered investors to access markets in new and better ways, Murphy added. “This is an industry in full growth mode because ETFs are solving investor problems, and product development keeps raising the bar on what’s possible,” she said.