Don’t doubt the rise of actively managed ETFs. Consider the following. Half of the respondents in an ongoing poll conducted by ETFGI believe the growth of active ETFs will be the most influential factor over broader industry growth over the next three years.
Growing is exactly what actively managed ETFs are doing. First-quarter net inflows into those funds were $245.1 billion, a 70% increase from the prior record, notes ETFGI. As of late April, year-to-date asset growth for actively managed checked in at a stellar 10.4% and these data points are all the more impressive when considering active ETFs account for just 10% of the total market.
Active ETFs’ rise boils down to a best-of-both worlds scenario. Advisors and investors love the ETF wrapper – the creation/redemption process, tax advantages and transparency – and many are clearly fond of active management. They accurately believe that some corners of the equity and fixed income markets are conducive to active management and that index funds face constraints in some of these areas.
That’s not to say active ETFs will usurp their passive rivals. It’s not going to happen anytime soon, but advisors should expect the active ETF growth spurt to continue.
Behold Active ETFs’ Growth
Undoubtedly, momentum is on the side of active ETFs and that holds true across various asset class.
“After record inflows of US$332 billion in 2024, global active ETFs captured US$541 billion in 2025, marking the 69th consecutive month of positive flows for the segment,” notes State Street Investment Management. “Global active ETF assets reached approximately US$1.8 trillion in 2025, reflecting a 56% compound annual growth rate (CAGR) over the past three years.”
(Image: State Street)
Interestingly, active ETF adoption is very much a global phenomenon. As State Street notes, these funds now trade on 46 exchanges in 36 countries. Just five years ago, there were merely 1,000 actively managed ETFs trading around the world. Today, that number is north of 4,000. Alone, that’s impressive, but when it comes to forecasting future growth, that’s a believable concept because advisors and investors are asset class-agnostic when it comes to embracing active ETFs.
“Actively managed equity and fixed income ETFs both saw strong demand in 2025, with the latter gaining prominence as investors sought yield and risk management tools in a complex interest rate environment,” observes State Street.
Familiar Concepts Driving Active ETF Adoption
In the U.S., income, both equity and fixed, is acting as a catalyst for active adoption. That makes at a time when the dividend yield on the S&P 500 is near 50-year lows and at a time when more advisors and clients are discovering flaws with passive aggregate bond structures.
“Fixed income positioning also reveals clear regional nuances. In the US, active fixed income ETF assets are most heavily concentrated in short‑duration and cash‑like strategies (29%, or US$139 billion), followed by US core bonds (25%) and securitized exposures (13%), underscoring a focus on liquidity management, duration control, and capital preservation,” according to State Street.
On the equity income side, those active ETFs, helped in large part by options income funds, represent 21% of all active ETF assets in this country after posting a five-year CAGR of 101%.
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