The ETF industries on both sides of the Atlantic can be compared from various angles, but there are only three comparisons at the macro level which make sense. A view of the overall assets under management and their split by asset type gives a good overview of investor behavior in the respective region, as it shows the preferred asset types and how much of the assets are invested in which asset type. Another angle is the comparison at the promoter level. This gives a brief overview of the concentration of assets under management at the promoter level and shows if the competition on this level is still intact or if an oligopoly is absorbing all the flows. Lastly, a view of the distribution of the assets under management at the classification level gives a more detailed view of the general investor behavior in Europe and the U.S. when it comes to investment preferences.
ETF Investors in Europe Have a Wider Choice of Classifications
Generally speaking, it can be said that investors in Europe have more options to implement their asset allocation views since the ETFs in Europe are split into 190 different Lipper Global Classifications, while the ETFs in the U.S. are split into 136 classifications.
Graph 1: Number of Lipper Global Classifications in the U.S. and European ETF Industry, March 31, 2026
Source LSEG Lipper
That said, a more detailed view of the asset types shows that U.S. investors might have a more dedicated choice when it comes to their asset allocation since U.S. investors can choose from four absolute return and 12 alternatives classifications, while there are “only” nine alternative classifications and no absolute return classifications available to European investors. Nevertheless, European investors have a wider choice when it comes to core asset types. They can choose from 62 bond classifications and 96 equity classifications, while their U.S. peers can choose from 23 bond classifications and 76 equity classifications.
Graph 2: Number of Classifications by Asset Type – U.S. vs European ETF Industry, March 31, 2026
Source: LSEG Lipper
When it comes to the none-core asset types, European investors have an advantage when it comes to money market ETFs since they can choose from four classifications, while their U.S. counterparts have only the choice from one classification. This changes when it comes to commodities (U.S.: six classifications – Europe: five) and mixed assets, where U.S. investors can choose from 14 classifications, while there are “only” 12 classifications available in Europe.
U.S. ETF Investors Have Different Preferences Than Their European Peers
A view at the table of the 10-largest Lipper Global Classifications by assets under management shows that U.S. ETF investors seem to have a home bias since five of the 10 largest classifications have a U.S. focus, while there are only two classifications with a European focus on the table of the 10-largest Lipper Global Classifications for Europe.
That said, the U.S. equity market is the largest and most liquid equity market in the world, therefore it is not surprising that Equity U.S. is the largest ETF classification by AUM on both sides of the pond. The other similarities are Equity Sector Information Technology, Equity Emerging Markets Global, Commodity Precious Metals, and Bond USD Government Short Term.
With regard to ETFs classified as Commodity Precious Metals, it is noteworthy that these products can only be held by investors outside the EU, since investments in single assets/securities such as gold are not permitted by the UCITS regulation.
Graph 3: 10 Largest Lipper Global Classifications in European and the U.S. ETF Industry, (in bn USD) March 31, 2026
Source: LSEG Lipper
One example to showcase how different investors in Europe and the U.S. act is the usage of global equity ETFs, which can be found on the second place on both tables. While U.S. investors prefer to use ETFs classified as Equity Global ex U.S. to diversify their portfolios away from U.S. equities, European investors prefer ETFs classified as Equity Global, which contain European equities alongside others. This means U.S. ETF investors explicitly seek diversification for their portfolios which might be overweighted in U.S. equities compared to all global indices, while European ETF investors use global equities ETFs, which also contain European equities. The latter might be explained by the assumption that the portfolios of European investors might be generally underweight in European equities.
High Concentration of the Assets Under Management at the Classification Level
Even as ETF investors in Europe and the U.S. can choose from a broad variety of classifications, the assets under management are still highly concentrated at the classification level. While the 10-largest Lipper Global Classifications in Europe account for $2,029.7 bn, or 66.26%, of the overall assets under management in the European ETF industry, the 10-largest classifications in the U.S. are accounting for $10,473.3 bn, or 76.72%, of the overall AUM in the U.S. ETF industry.
Graph 4: Market Share of the 10-Largest Lipper Global Classifications in the European and the U.S. ETF Industry by Assets Under Management, March 31, 2026
Source: LSEG Lipper
With this in mind, one might conclude that the lower number of classifications means that the U.S. ETF industry shows a higher concentration of assets under management at the classification level than the European ETF industry. From my point of view, this assumption is not true, since it rather looks like the high concentration of AUM at the classification level is caused by the home bias of U.S. ETF investors. Nevertheless, this analysis showed that there might be some gaps in the general ETF offering on both sides of the Atlantic which might be filled with new products launched by innovative ETF issuers. This might be especially true in the segments of absolute return and alternatives ETFs in Europe, but also in the segment of bond and equity ETFs in the U.S.
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
