October 2025 was another month with healthy inflows for the U.S. ETF industry.
These inflows occurred in a month of cautious optimism for global markets. Investors were caught between shifting central bank tones, renewed geopolitical jitters, and a tentative rebound in risk appetite.
The U.S. Federal Reserve finally delivered what investors had priced in for weeks—a modest rate cut paired with dovish forward guidance, hinting at more to come. The underlying message that the tightening cycle is over rippled through bond markets and boosted equities. In contrast, the European Central Bank stood pat, opting for stability amid slowing growth and still-elevated inflation expectations. The policy divergence widened transatlantic yield spreads and pushed the euro modestly lower against the dollar.
Political turbulence once again gripped Europe. France’s third government reshuffle in less than a year rattled investors, lifting French bond spreads and denting confidence in the eurozone’s reform narrative. Meanwhile, renewed optimism over U.S.–China trade talks, coupled with easing sanctions rhetoric, injected a dose of relief into Asian equities. As a result, markets priced in a fragile sense of stability, dependent on political headlines.
After months of selling pressure, sovereign bonds staged a notable comeback. Yields on 10-year U.S. Treasuries fell back below 4.2%, while U.K. gilts and German Bunds saw similar declines of 25–30 basis points. The rally reflected not only cooling inflation data but also growing expectations of synchronized monetary easing in early 2026. Still, analysts warned that structural risks—such as high fiscal deficits, sticky service inflation, and geopolitical fragmentation—could easily cap further gains.
Stocks ended the month on a cautiously positive note. The Nasdaq led gains, fueled by strong earnings from AI-related tech giants and easing funding costs. European markets lagged, weighed down by political noise and sluggish manufacturing data. Sector rotation was evident—defensives and energy underperformed, while luxury and automotive names caught a bid from signs of Chinese consumer recovery.
October’s rebound hinted at resilience but also fragility. Investors are increasingly trading between two narratives—soft-landing optimism versus structural headwinds. With policy easing back on the table, increasing earnings pressure, and geopolitics refusing to fade, the search for stability might have just begun.
From a U.S. ETF industry perspective, the performance of the underlying markets led, in combination with the estimated net flows, to increasing assets under management from $12,730.5 bn as of September 30, 2025, to a new all-time high of $13,104.4 bn at the end of October. At a closer look, the increase in assets under management of $373.9 bn for October was driven by the performance of the underlying markets (+$203.4 bn), while estimated net inflows contributed $170.5 bn to the growth of the assets under management.
Assets Under Management by Asset Type
As for the overall structure of the U.S. ETF industry, it was not surprising equity ETFs ($9,983.1 bn) held the majority of assets, followed by bond ETFs ($2,207.9 bn), alternatives ETFs ($584.3 bn), commodities ETFs ($295.6 bn), mixed-assets ETFs ($28.4 bn), and money market ETFs ($4.9 bn).
Within the current market environment, it is not surprising that the assets under management for all asset types, with the exception of mixed assets, marked an all-time high at the end of the month. These numbers show that the main headwinds on the markets have turned into tailwinds which were pushing the assets under management up over the course of the month.
Graph 1: Market Share, Assets Under Management in the U.S. ETF Industry by Asset Type, October 31, 2025
Source: LSEG Lipper
ETF Flows by Asset Type
The U.S. ETF industry enjoyed healthy estimated net inflows (+$170.5 bn) over the course of October despite some market insecurities in the equity and bond markets. These inflows drove the overall inflows in ETFs in the U.S. up to $1,098.7 bn for the year 2025 so far.
Given the strong recovery of equity markets in the second quarter of 2025 and the relatively good results presented by most of the leading companies during the last earnings season, it is not surprising that the inflows in the U.S. ETF industry for October were driven by equity ETFs (+$102.0 bn), followed by bond ETFs (+$49.8 bn), alternatives ETFs (+$10.7 bn), commodities ETFs (+$5.7 bn), money market ETFs (+$1.2 bn), and mixed-assets ETFs (+$1.1 bn).
The relatively high inflows into bond ETFs, despite the insecurities about the future level of debt in the U.S., might be a sign that U.S. investors are still looking for safe haven investments given the unclear outlook for future earnings from some companies caused by the still somewhat unclear consequences for corporate earnings from the announced new tariff regime in the U.S.
Graph 2: Estimated Net Sales by Asset Type, October 2025 (USD Billions)
Source: LSEG Lipper
More generally speaking, it can be said that the flow numbers in the U.S. ETF industry indicate that U.S. investors are in risk-on mode.
Assets Under Management by Lipper Global Classifications
To examine the U.S. ETF markets in further detail, a review of the Lipper global classifications will lead to more insights on the structure and concentration of assets within the U.S. ETF industry. At the end of October 2025, the U.S. ETF market was split into 140 different peer groups (Lipper Global Classifications). The highest assets under management at the end of October were held by funds classified as Equity U.S. ($5,607.3 bn), followed by Equity Global ex U.S. ($992.0 bn), Equity U.S. Small & Mid Cap ($942.8 bn), Bond USD Medium Term ($561.6 bn), and Equity Sector Information Technology ($465.3 bn). These five peer groups accounted for $8,569.0 bn, or 65.39%, of the overall assets under management in the U.S. ETF segment, while the 10-top classifications by assets under management accounted for $10,113.0 bn, or 77.17%.
Overall, 17 of the 140 peer groups each accounted for more than 1% of assets under management. In total, these 17 peer groups accounted for $11,328.6 bn, or 86.45%, of the overall assets under management.
Graph 3: Ten Largest Lipper Global Classifications by Assets Under Management, October 31, 2025 (USD Billions)
Source: LSEG Lipper
The peer groups on the other side of the table showed some funds in the U.S. ETF market are quite low in assets and their constituents may face the risk of being closed in the near future. They are obviously lacking investor interest and might, therefore, not be profitable for their respective fund promoters.
Graph 4: Ten Smallest Lipper Global Classifications by Assets Under Management, October 31, 2025 (USD Billions)
Source: LSEG Lipper
ETF Flows by Lipper Global Classifications
The net inflows of the 10 best-selling Lipper classifications accounted for $127.6 bn. In line with the overall sales trend for October, equity classifications (+$81.7 bn) gathered the majority of flows by asset type on the table of the 10 best-selling classifications by estimated net inflows for October 2025. Given the overall fund flow trend in the U.S. ETF industry, it was not surprising that Equity U.S. (+$61.3 bn) was the best-selling Lipper global classification for October. It was followed by Bond USD Medium Term (+$14.1 bn) and Equity Global ex U.S. (+$10.6 bn).
The flows at the classification level show that U.S. investors seem to have further bought into U.S. large caps after the market turmoil in April to participate in the market recovery. In addition, they may also be looking for some lower volatility assets since there were five USD-based bond classifications on the table of the 10 best-selling classifications for October.
Despite the fact that there are classifications from various asset types on the table of the 10 best-selling classifications, these numbers show that the U.S. ETF segment is highly 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 5: Ten Best- and Worst-Lipper Global Classifications by Estimated Net Sales, October 2025 (USD Billions)
Source: LSEG Lipper
On the other side of the table, the 10 classifications with the highest estimated net outflows for October faced significantly lower overall outflows for the month (-$5.3 bn) than those for August (-$9.2 bn).
Equity U.S. Small & Mid Cap (-$1.9 bn) was the classification with the highest outflows for the month. It was bettered by Loan Participation Funds (-$1.3 bn), Equity Greater China (-$0.6 bn), Equity Sector Consumer Discretionary (-$0.5 bn), and Equity Sector Financials (-$0.4 bn).
Assets Under Management by Promoters
A closer look at assets under management by promoters in the U.S. ETF industry also showed high concentration, with only 119 of the 445 ETF promoters covered in this report holding assets at or above $1.0 bn—accounting for $13,045.6 bn in assets under management. The largest ETF promoter in the U.S.—iShares ($3,896.6 bn)—accounted for 29.74% of the overall assets under management, ahead of the number-two promoter—Vanguard ($3,760.2 bn)—and the number-three promoter—SPDR ($1,790.8 bn).
Graph 6: The 10 Largest ETF Promoters by Assets Under Management, October 31, 2025 (USD Billions)
Source: LSEG Lipper
The 10-top promoters accounted for 89.42% of the overall assets under management in the U.S. ETF industry. This meant, in turn, the other 435 fund promoters registering at least one ETF for sale in the U.S. accounted for only 10.58% of the overall assets under management. With regard to the concentration of the U.S. ETF industry by promoter, it is noteworthy that there were nine ETF promoters accounting for more than 1% of the overall assets under management each.
Please read our report: “U.S. ETF Industry – Review of the Concentration of Assets Under Management at the Promoter Level” for more information on the distribution of the assets under management at the promoter level.
ETF Flows by Promoters
Since the U.S. ETF market is highly concentrated when it comes to the assets under management by promoter, it was not surprising that eight of the 10 largest promoters by assets under management were among the 10-top selling ETF promoters for October. Vanguard was the best-selling ETF promoter in the U.S. for October (+$51.0 bn), ahead of iShares (+$30.3 bn) and SPDR (+$25.1 bn).
Graph 7: Ten Best-Selling ETF Promoters, October 2025 (USD Billions)
Source: LSEG Lipper
The flows of the 10-top promoters accounted for estimated net inflows of $143.3 bn. As for the overall flow trend in October, it was clear that some of the 445 promoters (106) faced estimated net outflows (-$9.4 bn in total) over the course of the month.
Assets Under Management by ETFs
There were 4,675 instruments (primary share classes/portfolios [4,606] and [convenience] share classes [69]) listed as ETFs in the Lipper database at the end of October. Regarding the overall market pattern, it was not surprising assets under management at the ETF level were also highly concentrated. Only 885 of the 4,606 ETFs (primary share classes = portfolios) held assets above $1.0 bn each. These ETFs accounted for $12,497.0 bn, or 95.37%, of the overall assets in the U.S. ETF industry. The 10 largest ETFs in the U.S. accounted for $4,023.3 bn, or 30.70%, of the overall assets under management.
Graph 8: The 10 Largest ETFs by Assets Under Management, October 31, 2025 (USD Billions)
Source: LSEG Lipper
Estimated Net Flows at the ETF Level
A total of 2,529 of the 4,606 ETFs (primary share classes = portfolios) analyzed in this report showed net inflows of more than $10,000 each for October, accounting for inflows of $221.5 bn. This meant the other 2,077 ETFs faced no flows, or net outflows, for the month. Upon closer inspection, 352 of the 2,529 ETFs posting net inflows enjoyed inflows of more than $100 m during October—for a total of $188.0 bn. The best-selling ETF for October was Vanguard 500 Index Fund; ETF, which enjoyed estimated net inflows of $20.0 bn. It was followed by State Street SPDR Portfolio S&P 500 ETF (+$6.9 bn) and Invesco QQQ Trust. Series 1 (+$6.5 bn).
Graph 9: The 10 Best-Selling ETFs, October 2025 (USD Billions)
Source: LSEG Lipper
The flow pattern at the fund level indicated there was a lot of turnover and rotation during October, but it also showed the concentration of the U.S. ETF industry even better than the statistics at the promoter or classification levels since the 10 best-selling ETFs account for inflows of $60.2 bn.
Given its size and the overall trend for net sales at the promoter level, it was surprising that only two of the 10 best-selling ETFs for October were promoted by iShares. These iShares ETFs accounted for estimated net inflows of $7.9 bn. At the same time Vanguard, the number one contender of iShares for the position as largest ETF promoter in the U.S. had three ETFs on the table of the 10 best-selling ETFs for October, accounting for estimated net inflows of $26.8 bn.
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.
