The first half of 2025 saw a surge in active ETF launches, with 396 new products introduced—nearly seven times the number of new active mutual funds (58) and over six times the number of new passive ETFs (60). This dominance underscores a major shift in investor and issuer preferences toward the ETF structure for active management.
Active ETFs Lead in New Fund Launches
Note: excludes money market funds, closed-end funds, 529 funds, target-date series, and ETMFs
Several factors contribute to this trend:
- Operational efficiency: ETFs offer intraday liquidity, lower costs, and tax advantages compared to mutual funds.
- Regulatory flexibility: Rule changes have made it easier for asset managers to bring active strategies to market via ETFs.
- Investor demand: There’s growing appetite for transparency and flexibility, which ETFs provide more readily than traditional vehicles.
This shift suggests that active ETFs are no longer niche products—they’re becoming the preferred format for delivering active strategies.
