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Taylor Swift isn’t the only one who can’t stop breaking records.
Actively managed ETF assets have hit a new high, reaching nearly $2.5 trillion at the end of May, breaking April’s record of $2.3 trillion, according to data from ETFGI. It’s the 74th consecutive month of net inflows in actively managed exchange-traded funds, as the wrapper’s tax efficiency, liquidity and low cost continue to attract investor interest. The SEC’s decision to allow firms to launch ETF share classes of existing mutual funds has added to the momentum. While only about a third of ETF inflows went to actively managed funds in 2025, that market share is expected to grow.
“We’re still in the relatively early innings of the transition from mutual funds to ETFs,” said Matt Barry, vice president of ETF capital markets at Touchstone, adding that the SEC’s share class exemptions could be a “game changer.”
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Actively Managed, Actively Growing
Actively managed assets have increased nearly 30% since the beginning of the year, with the majority of inflows going to equity-focused ETFs and a third going to fixed income-focused vehicles. “The majority of new launches that we see are in the active category now and that’s partially because many would think that the index space is covered very well and is very competitive,” said Deborah Fuhr, managing partner and co-founder of ETFGI. Firms also can’t charge as much for plain vanilla funds, and managers feel they can stand out from the crowd with active strategies. The research also found:
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Dimensional is the largest issuer with almost $297 billion in active ETF assets under management.
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JP Morgan Asset Management is a close second at $291 billion, followed by iShares with $169 billion.
Double-Edged Sword: While many investors like the flexibility of being able to trade ETFs throughout the day, mutual funds may continue to provide unique benefits, said Wes Crill, senior client solutions director and vice president at Dimensional. “Let’s say I’m someone who wants to make a one-time trade in a very large quantity … depending on how you’re putting that trade through the market, you might end up having an order that goes beyond the available liquidity in the marketplace for that ETF,” he said. “So, there might be additional costs in terms of the trading that wouldn’t be relevant for a mutual fund.”
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