The inflows into the European ETF industry over the course of July (+€49.3 bn) further proved the trend of elevated inflows into ETFs in 2026 compared to previous years. In fact, the inflows into ETFs for July were the highest monthly inflows into ETFs in Europe on record. As expected from this, the estimated net inflows for July were above the rolling 12-month average flows (+€37.6 bn). Given the negative market environment, these inflows show that European ETF investors were further in risk-on mode in July.
Graph 1: Monthly Estimated Net Sales by Asset Type, January 1, 2024 – July 31, 2026 (Euro Billions)
Source: LSEG Lipper
In addition to this, it is noteworthy that the general fund flow trend for the year is set to reach a new all-time high on an annual basis at the end of the year. This shows that the popularity of ETFs among European investors is still growing despite the already in general higher inflows over the course of the years 2024 and 2025.
The inflows in the European ETF industry for July were driven by equity ETFs (+€37.2 bn), followed by bond ETFs (+€8.7 bn), money market ETFs (+€2.1 bn), commodities ETFs (+€1.0 bn), alternatives ETFs (+€0.2 bn), and mixed-assets ETFs (+€0.1 bn).
Graph 2: Estimated Net Sales by Asset Type, July 1 – July 31, 2026 (Euro Billions)
Source: LSEG Lipper
In order to examine the European ETF flows in further detail, a review of the flows by Lipper global classifications will lead to more insights. The European ETF market was split into 189 different peer groups at the end of July. The net inflows of the 10 best-selling Lipper classifications accounted for €37.5 bn. In line with the overall sales trend for July 2026, equity peer groups (+€34.4 bn) dominated the flows by asset type on the table of the 10 best-selling peer groups. That said, it was surprising to see only one bond classification on the table of the 10 best-selling classifications for the month.
Given the overall fund flow trend in the European ETF industry, it was not surprising that Equity Global (+€12.6 bn) was the best-selling Lipper global classification for July. It was followed by Equity U.S. (+€10.4 bn), Equity Emerging Markets Global (+€3.7 bn), Equity Europe (+€1.9 bn), and Money Market EUR (+€1.8 bn).
Generally speaking, it is somewhat surprising that Equity Europe is on the table of the 10 best-selling Lipper classifications since the classification was out of favor of European investors for the last three months. Hence, it looks like the beginning trend of constant outflows from Equity Europe has been reversed.
In more detail, while the estimated net flows on the level of the single countries in Europe showed overall outflows (-€0.3 bn), the flows for the regional classifications (Equity Europe ex UK (-€0.4 bn), Equity Nordic (-€0.1 bn), Equity Europe Income (+€0.2 bn), and Equity Europe (+€1.9 bn), are overall positive (+€1.6 bn). Nevertheless, it looks like European investors prefer the broadest possible classification over more narrow classifications.
Graph 3: Ten Best- and Worst-Lipper Global Classifications by Estimated Net Sales, July 1 – July 31, 2026 (Euro Billions)
Source: LSEG Lipper
Equity U.S. (+€10.4 bn) was once again the second best-selling Lipper classification and had a large lead on the third best-selling classification Equity Emerging Markets Global (+€3.7 bn). This shows that European investors are still comfortable with buying into the U.S. equity market. That said, Equity U.S. Income enjoyed estimated net inflows (+€0.2 bn), while Equity U.S. Small & Mid Caps posted estimated net outflows (-€0.2 bn). This flow pattern shows that European investors prefer ETFs which are covering broad U.S. equity indices over ETFs with a style or size bias.
Even as Bond EMU Government (+€1.3 bn) was the only bond classification on the table of the 10 best-selling classifications it was followed closely by Bond Global USD (+€1.2 bn), which was the eleventh best-selling Lipper classification for the month. That said, there were outflows from one euro denominated bond classification (Bond Global EUR (-€0.1 bn)) and two US dollar denominated Lipper classifications (Bond USD Corporates (-€0.02 bn) and Bond USD Mortgages (-€0.04 bn).
Overall, European investors preferred in general US dollar denominated bond classifications (+€3.9 bn), over euro denominated classifications (+€2.5 bn) since they may appreciate the higher interest rates in the U.S. and do see only limited downside risks for the US dollar compared to the euro.
The general trend of inflows into money market products continued over the course of July, as Money Market GBP (+€0.01 bn), Money Market USD (+€0.3 bn), and Money Market EUR (+€1.8 bn) enjoyed inflows, while Money Market CHF posted no flows at all. These inflows might be caused by some European investors who may have put some money on the sidelines or bought money market ETFs instead of short-term bond ETFs.
On the other side of the table, the 10 classifications with the highest estimated net outflows for July 2026 accounted for €2.5 bn in outflows.
Equity China (-€0.8 bn) was the classification with the highest outflows for the month. It was bettered by Equity Europe ex UK (-€0.4 bn), Equity Germany (-€0.2 bn), Equity Emerging Markets Asia (-€0.2 bn), and Equity Emerging Markets Latin America (-€0.2 bn).
Generally speaking, a view of the Lipper classifications with the highest outflows may indicate that European investors have reduced or closed some of their non-core positions, like regional emerging markets or small caps ETFs, etc. over the course of July 2026. These transactions might have been profit taking or have been caused by a general reduction of the overall risk/reallocation of risk budgets in the portfolios of European investors.
The views expressed are the views of the author, not necessarily those of LSEG.
This article is for information purposes only and does not constitute any investment advice.
