The first nine months of 2025 was a period with healthy estimated net inflows for the Indo-Pacific ETF industry. It also was not easy to navigate for investors since the announcement of possible tariffs by the U.S. president sent shockwaves through the stock markets around the world. As a result, investors around the globe acted nervous over any political and economic news, especially by the announcements around the new tariff regime by the U.S. president and potential tit-for-tat reactions from the markets which are the targets of the new tariffs. That said, the tariffs are seen as a kind of trade war between the U.S. and the rest of the world, especially China, by some market observers.
When it comes to equities, investors were concerned about the impact of any new tariffs on the growth expectations of literally all economies around the globe. In addition to this, investors were also concerned about the impact of new tariffs on the profitability of all kinds of companies, as well as the impact of tariffs on inflation around the globe. That said, the U.S. stock market showed the fastest recovery in history from its low reached on April 8, 2025, even as several companies couldn’t give investors any guidance on future earnings since the impact from possible tariffs is still unknown.
Additionally, the increasing tensions in the Middle East also impacted investor sentiment, especially the intensifying conflict between Israel and Iran, since this had the potential to become a broader conflict in the region and could drive up the price for oil. Despite these concerns, the swings in the price for oil during this conflict was more stable than investors had expected. This was because no oil production sites were hit by military actions in the region and the shipping route through the Strait of Hormuz stayed open.
Nevertheless, the war in Ukraine and the increasing number of conflicts around the world led to a defense spending spree in Europe. The respective announcements by governments over the course of the first five months of the year led to a bull market for defense-related stocks. Furthermore, the NATO member states agreed in September 2025 to increase their defense spending from 2.0% to 5.0% of their respective GDPs.
Meanwhile, central banks around the globe tried to adjust their policies to the current environment. While the European Central Bank (ECB) has further cut interest rates and reached its target rate of 2.0%, the same is somewhat true for the Bank of England—where the interest rate still stands at 4.25%—and Swiss National Bank, which has reached 0.0%. Conversely, the Bank of Japan (BoJ) had to increase its interest rates to 0.5%. The U.S. Federal Reserve left its interest rates (4.25% to 4.50%) unchanged over the course of the first six months of 2025, and started to lower its rates during Q3 2025. These decisions reflect central banks’ efforts to navigate economic challenges, including trade tensions, inflationary trends, and high market volatility, to support their local economies.
Nevertheless, fears of increasing debt in the U.S. put some pressure on the U.S. bond market since investors fear increasing interest rates because of the increasing debt. That said, the downgrade of the U.S. by Moody’s on May 16, 2025, also contributed to these fears. When it comes to this, it is not surprising that the U.S. dollar has weakened against other major currencies despite the relatively high interest rate in the U.S.
More generally speaking, aside from the geopolitical tensions, there is only a very limited number of indicators which are sending negative signals for economic growth in the U.S. and other major economies around the world. When it comes to this, it is noteworthy that most of these negative indicators are being offset by positive signals from others. Nevertheless, some major economies lack economic growth and may need lower interest rates and/or increased government spending as stimulus. Despite these headwinds, the positive effects of lower interest rates seem to be more important for investors than the current state of some economies.
Assets Under Management by Asset Type
From an Indo-Pacific ETF industry perspective, the performance of the underlying markets led—in combination with the estimated net flows—to increasing assets under management (from $1,690.4 bn as of December 31, 2024, to $2,246.9 bn at the end of September 2025). At a closer look, the increase in assets under management of $556.4 bn for the first nine months of 2025 was driven by the performance of the underlying markets (+$473.3 bn), while estimated net inflows added $83.1 bn to the assets under management.
Graph 1: Assets Under Management in the Indo-Pacific ETF Industry, December 31, 2024 – September 30, 2025 (USD billions)
Source: LSEG Lipper
As for the overall structure of the Indo-Pacific ETF industry, it was not surprising equity ETFs ($1,835.1 bn) held the majority of assets, followed by bond ETFs ($254.8 bn), commodities ETFs ($50.8 bn), money market ETFs ($47.0 bn), alternatives ETFs ($30.4 bn), “other” ETFs ($20.7 bn), and mixed-assets ETFs ($8.2 bn).
Graph 2: Market Share, Assets Under Management in the Indo-Pacific ETF Industry by Asset Type, September 30, 2025
Source: LSEG Lipper
ETF Flows by Asset Type
The Indo-Pacific ETF industry enjoyed estimated net inflows (+$83.1 bn) over the course of the first nine months of 2025 despite the global economic headwinds.
The inflows in the Indo-Pacific ETF industry for the first nine months of 2025 were driven by equity ETFs (+$52.9 bn), followed by bond ETFs (+$12.1 bn), money market ETFs (+$8.3 bn), commodities ETFs (+$7.8 bn), mixed-assets ETFs (+$2.5 bn), and alternatives ETFs (+$0.4 bn), while “other” ETFs (-$0.9 bn) faced outflows.
Graph 3: Estimated Net Sales by Asset Type, Year to Date – September 2025 (USD Billions)
Source: LSEG Lipper
As graph 4 shows, equity and bond ETFs showed different flow patterns over the course of the first three quarters of 2025. A more detailed view of the flows shows that bond and equity flows slowed down during the market turmoil over the course of the second quarter. Nevertheless, it looks like investors in the Indo-Pacific region returned to risk-on mode over the course of the third quarter. In addition, the graph also shows that the flows in bond ETFs have returned stronger over the course of Q3 2025 than the flows for equity ETFs.
Graph 4: Monthly Estimated Net Sales by Asset Type, January 1, 2025 – September 30, 2025 (USD billions)
Source: LSEG Lipper
The trend for the estimated net flows over the course of Q1 2025 was somewhat surprising given the uncertainty of the markets over a possible new tariff regime scheduled to be introduced at the beginning of April but which was delayed. Despite this, the insecurities over increasing debt in the U.S. and other regions of the world, as well as the future economic environment with regard to the effects caused by possible tariffs, could be seen in the estimated net flows in the Indo-Pacific ETF industry over the course of Q2. Even as these uncertainties haven’t been clear until now, equity markets were mainly positive over the course of Q3. The strong performance of the markets led to strong inflows into equity ETFs.
Assets Under Management by Lipper Global Classifications
In order to examine the Indo-Pacific ETF industry in further detail, a review of the Lipper global classifications will lead to more insights on the structure and concentration of assets. At the end of Q3 2025, the Indo-Pacific ETF market was split into 159 different Lipper classifications. The highest assets under management at the end of Q3 were held by funds classified as Equity Japan ($628.5 bn), followed by Equity China ($329.5 bn), Equity Sector Information Technology ($147.1 bn), Equity Taiwan ($109.6 bn), and Equity US ($81.7 bn). These five peer groups accounted for 57.70% of the overall assets under management in the Indo-Pacific ETF industry, while the 10-top classifications by assets under management accounted for 71.66%.
Overall, 18 of the 159 peer groups each accounted for more than 1% of assets under management. In total, these 18 peer groups accounted for $1,898.3 bn, or 84.49%, of the overall assets under management.
Graph 5: 15 Largest Lipper Global Classifications by Assets Under Management, September 30, 2025 (USD Billions)
Source: LSEG Lipper
The numbers above show that the Indo-Pacific ETF region is more concentrated at the classification level than the global ETF industry or the other regions. In addition, the numbers above show that investors in the Indo-Pacific region have a home bias when it comes to ETF investments. This behavior is in line with U.S. investors, but opposite to that of European investors. This being the case, it was not surprising to see that Equity Global ($53.6 bn) was only the ninth largest Lipper classification in the Indo-Pacific region.
The peer groups on the other side of the table showed that some Lipper classifications in the Indo-Pacific hold only a small number of assets under management, which means their constituents may face the risk of being closed in the near future. The respective ETFs are obviously lacking investor interest and might, therefore, not be profitable for their respective fund promoters.
Graph 6: Ten Smallest Lipper Global Classifications by Assets Under Management, September 30, 2025 (USD Billions)
Source: LSEG Lipper
ETF Flows by Lipper Global Classifications
The net inflows of the 10 best-selling Lipper classifications in the Indo-Pacific region accounted for $68.9 bn over the course of the first nine months of 2025. In line with the overall sales trend for the year so far, equity peer groups (+$43.7 bn) gathered the majority of flows by asset type on the table of the 10 best-selling classifications by estimated net inflows for the first nine months of 2025. That said, compared with the concentration of flows for the single regions, the 10 best-selling Lipper classifications are somewhat more diversified in the Indo-Pacific region. Given the overall fund flow trend and the investor behavior in the Indo-Pacific ETF region, it was not surprising that Equity Taiwan (+$14.7 bn) was the best-selling Lipper global classification for the first nine months of 2025. It was followed by Equity U.S. (+$10.4 bn) and Commodity Precious Metals (+$7.7 bn).
Since money market is in general not considered a core asset type within the ETF industry globally, it is surprising to see Money Market KRW (+$7.0 bn) on the table for the best-selling classifications for the Indo-Pacific ETF industry.
More generally, these numbers showed the Indo-Pacific ETF industry is concentrated when it comes to the estimated net flows by classification. Generally speaking, one would expect the flows into ETFs to be concentrated since investors often use ETFs to implement their market views and short-term asset allocation decisions. These products are made and, therefore, are easy to use for these purposes.
Graph 7: Ten Best- and Worst-Lipper Global Classifications by Estimated Net Sales, Year to Date – September 2025 (USD Billions)
Source: LSEG Lipper
On the other side of the table, the 10 peer groups with the highest estimated net outflows for first nine months of 2025 accounted for $18.1 bn in outflows.
Alternative Equity Leveraged (-$8.1 bn) was the Lipper classification with the highest outflows for the first nine months of 2025. It was bettered by Equity Hong Kong (-$2.6 bn), Equity Japan (-$2.0 bn), Bond USD Government (-$1.9 bn), and Unclassified (-$0.9 bn).
Assets Under Management by Promoters
A closer look at the assets under management by promoters in the Indo-Pacific ETF industry shows a lower concentration of assets under management than in other regions, or for the ETF industry globally. In more detail, 87 of the 261 ETF promoters in the Indo-Pacific ETF industry are holding assets at or above $1.0 bn. The largest ETF promoter in the Indo-Pacific ETF industry—Nomura Asset Management ($298.0 bn)—accounted for 13.26% of the overall assets under management, ahead of the number-two promoter—Amova Asset Management ($137.3 bn)—and the number-three promoter—China AMC ($131.5 bn).
From a global ETF industry perspective it is surprising that the two largest ETF promoters in the world do not appear on one of the top spots in the Indo-Pacific region. iShares—the world’s largest ETF promoter ($92.3 bn)—is “only” the sixth largest ETF promoter in the Indo-Pacific region, while Vanguard ($49.3 bn) is the thirteenth largest ETF promoter in the Indo-Pacific region.
Graph 8: The 10 Largest ETF Promoters by Assets Under Management, September 30, 2025 (USD Billions)
Source: LSEG Lipper
The 10-top promoters accounted for 53.36% of the overall assets under management in the Indo-Pacific ETF industry. This meant, in turn, the other 251 ETF promoters registering at least one ETF for sale in the Indo-Pacific region accounted for 46.64% of the overall assets under management. These numbers show that the assets under management at the promoter level in the Indo-Pacific ETF industry are far more diversified than in the other regions, or on a global level.
ETF Flows by Promoters
Since the Indo-Pacific ETF industry is not as highly concentrated when it comes to the assets under management by promoter than in other parts of the world, it was not surprising that only four of the 10 largest ETF promoters by assets under management were among the 10-top selling ETF promoters for the first nine months of 2025. Samsung was the best-selling ETF promoter in the Indo-Pacific ETF industry for the first nine months of 2025 (+$12.6 bn), ahead of Mirae Asset (+$9.6 bn) and Vanguard (+$7.4 bn).
Graph 9: Ten Best-Selling ETF Promoters, Year to Date – September 2025 (USD Billions)
Source: LSEG Lipper
The flows of the 10-top promoters accounted for estimated net inflows of $64.6 bn. As for the overall flow trend over the course of the year 2025 so far, it was clear that some of the 261 promoters (56) faced estimated net outflows (-$11.2 bn in total) over the course of the first nine months of 2025.
Assets Under Management by Domicile
To investigate the concentration by region further, it makes sense to analyze the assets under management by domicile. As of the end of Q3 2025, China ($770.8 bn) overtook Japan as the largest single country ETF domicile of the 15 ETF domiciles covered in this report over the course of the third quarter. Japan ($687.3 bn) is now the second largest ETF domicile in the Indo-Pacific region, followed by Taiwan ($230.1 bn), Australia ($191.5 bn), and the Republic of Korea ($177.7 bn). These five ETF domiciles account for assets under management of $2,057.4 bn, or 91.57%, of the overall assets under management in the Indo-Pacific ETF industry.
Graph 10: Indo-Pacific ETF Domiciles by Assets Under Management – September 30, 2025 (in bn USD)
Source: LSEG Lipper
These numbers show that the assets under management in the Indo-Pacific ETF industry are somewhat dominated by a small number of domiciles. Obviously, this concentration is not as high as for Europe.
Estimated Net Flows by Domicile
In more detail, the Republic of Korea (+$33.8 bn) was the single fund domicile with the highest estimated net inflows in the Indo-Pacific region. It was followed by Australia (+$22.8 bn), Taiwan (+$14.0 bn), India (+$8.1 bn), and Hong Kong (+$2.1 bn).
Graph 11: Estimated Net Inflows by ETF Domicile, Year to Date – September 2025 (in bn USD)
Source: LSEG Lipper
On the other side of the table, New Zealand (-$1.0 bn), and Vietnam (-$0.2 bn) were the only ETF domiciles in the Indo-Pacific region which faced outflows over the course of 2025 so far.
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.
