The growth of ETFs is being driven by strong capital inflows across all asset classes, while market performance continues to boost mutual fund assets, according to the Cerulli Edge-U.S. Monthly Product Trends report, which analyzes mutual fund and ETF trends through August 2024.
ETFs reached $9.7 trillion in assets, marking a year-over-year increase of 30%, with inflows of $78 billion in August, as advisors continued to turn to this structure for an expanding range of exposures.
The report, released on October 1 by Cerulli, also notes that institutional investors are reallocating their risk budgets toward private market investment strategies.
Additionally, by the end of August, mutual fund assets amounted to $20.3 trillion, with a month-over-month growth of 1.7%, despite outflows of $42.3 billion and $600 million, respectively, from active and passive mutual funds.
As institutions work to reallocate their risk budgets toward private market investments, their strategies around vehicle selection are crucial for ensuring adequate funding.
While lower-cost traditional market vehicles enable institutions to achieve this goal, the pursuit of customization can often counterbalance the search for lower-cost funds, blurring trade-offs between vehicles that would otherwise be clearer, the report concludes.
For Amaya Uriarte