January 2026 was another month with strong inflows for the European ETF industry.
These inflows occurred in a complex mix of geopolitical tension, unchanged central bank paths and shifting fiscal narratives that collectively shaped global equity and bond markets. Despite recurring volatility, investor sentiment across major markets remained cautiously constructive, buoyed by resilient economic data and still‑supportive financial conditions.
Geopolitics was the dominant macro-overhang. The month saw U.S. military action in Venezuela, renewed threats of strikes on Iran, and escalating friction between Washington and NATO allies over Greenland, adding layers of uncertainty, particularly for energy and commodity markets. These tensions helped propel oil prices higher and contributed to a weaker U.S. dollar mid‑month before a sharp rebound. European markets felt the spillover through elevated risk premiums and heightened sensitivity to U.S.–EU trade rhetoric, especially with tariff threats resurfacing.
Within this environment the Federal Reserve held rates stable at 3.50%–3.75% at its January meeting, signalling a pause after its 2025 interest rate easing amid still elevated inflation and a softening but resilient labor market.
In line with the Federal Reserve, the European Central Bank (ECB) remained also on hold, even as Eurozone inflation (1.9%) fell under the ceiling of the ECB inflation target in December. The same is true for the Bank of England (BoE), as the BoE kept its rate stable, after lowering interest rates by 25 basis points (bps) to 3.75% in December. The Bank of Japan (BoJ) kept its policy rate also stable in January, as the BoJ hiked its policy rate to a 30-year high at 0.75% in December 2025.
Fiscal policy also shaped the performance of the securities markets. The U.S. continued to run large deficits, raising expectations of elevated Treasury issuance that contributed to a further steepening in the U.S. yield curve. In Europe, fiscal consolidation efforts were more measured, with Germany’s economic indicators improving and yields rising accordingly. The Eurozone’s more disciplined stance kept spreads stable, supporting a relatively favorable environment for corporate credit.
The overall somewhat positive macro indicators led to a positive start of the year for equities globally, while markets absorbed negative news with remarkable composure. At the same time, bond markets delivered mixed returns, with long‑dated yields rising globally—most notably in Japan—while Germany remained an exception. Corporate bonds fared better as spreads narrowed in line with healthy balance sheets and steady economic momentum.
From a European ETF industry perspective, the performance of the underlying markets led, in combination with the estimated net flows, to increasing assets under management (from €2,578.3 bn as of December 31, 2025, to €2,674.6 bn at the end of January 2026). At a closer look, the increase in assets under management of €96.3 bn for January was driven by the performance of the underlying markets (+€48.3 bn), while estimated net inflows added (+€48.0 bn) to the increase in assets under management.
Assets Under Management in the European ETF Industry
As for the overall structure of the European ETF industry, it was not surprising equity ETFs (€2,048.2 bn) held the majority of assets, followed by bond ETFs (€504.0 bn), commodities ETFs (€64.3 bn), money market ETFs (€43.9 bn), alternatives ETFs (€9.2 bn), and mixed-assets ETFs (€4.9 bn).
Given the volatile but positive market environment over the course of the year, it is no surprise that the overall assets under management in the European ETF industry (€2,674.6 bn) hit a new all-time high at the end of the year. When it comes to this, it is noteworthy that the assets under management for all asset types, with the exception of alternatives and money market, reached also a new all-time high at the end of the month.
Graph 1: Market Share, Assets Under Management in the European ETF Segment by Asset Type, January 31, 2026
Source: LSEG Lipper
ETF Flows by Asset Type
The inflows into the European ETF industry over January reached for the first time a level above €40.0 bn on a monthly basis (+€48.0 bn). This showcases that the popularity of ETFs amongst European investors is still growing despite the in general high inflows over the course of the years 2024 and 2025.
The inflows in the European ETF industry for January were driven by equity ETFs (+€37.4 bn), followed by bond ETFs (+€9.5 bn), money market ETFs (+€1.9 bn), and mixed-assets ETFs (+€0.1 bn). Conversely, alternatives ETFs (-€0.2 bn) and commodities ETFs (-€0.7 bn) faced estimated net outflows.
Graph 2: Estimated Net Sales by Asset Type, January 1 – January 31, 2026 (Euro Billions)
Source: LSEG Lipper
Given the market environment, it was somewhat surprising to see estimated net inflows into ETFs on this high level led by equity ETFs over the course of the month.
Assets Under Management by Lipper Global Classifications
In order to examine the European 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 European ETF industry. At the end of January, the European ETF market was split into 183 different peer groups. The highest assets under management at the end of January were held by ETFs classified as Equity U.S. (€622.0 bn), followed by Equity Global (€495.1 bn), Equity Europe (€226.8 bn), Equity Emerging Markets Global (€140.2 bn), and Bond EUR Corporates (€60.6 bn). These five peer groups accounted for 57.75% of the overall assets under management in the European ETF segment, while the 10-top classifications by assets under management accounted for 67.00%.
Overall, 17 of the 183 peer groups each accounted for more than 1% of assets under management. In total, these 17 peer groups accounted for €2,024.7 bn, or 75.70%, of the overall assets under management.
Graph 3: Ten Largest Lipper Global Classifications by Assets Under Management, January 31, 2026 (Euro Billions)
Source: LSEG Lipper
In addition, it was noteworthy that Bond EUR Corporates has moved up on the list of the five largest Lipper classifications in January, while Equity Sector Information Technology fell from the fifth to the sixth spot. This may be a sign of a change in risk appetite of European investors.
More generally, the rankings of the largest classifications saw some movement in single positions over the last few years. As the positions of the classifications had been quite stable in the past, this indicates that European investors use ETFs to trade according to their market views. Even as some of these positions might be core holdings, once investors got into risk-off mode they also reduced their exposure to core asset classes.
Despite the fact that the rankings at the top of the league show some changes from time to time, these numbers show that the assets under management by Lipper global classifications continued to be highly concentrated in the European ETF industry.
The peer groups on the other side of the table showed some funds in the European 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 (Please read our report: “Will the ETFs in the Smallest Lipper Classifications in the European ETF Industry Survive?” for more details on this topic).
Graph 4: Ten Smallest Lipper Global Classifications by Assets Under Management, January 31, 2026 (Euro Billions)
Source: LSEG Lipper
ETF Flows by Lipper Global Classifications
The net inflows of the 10 best-selling Lipper classifications accounted for €31.7 bn. In line with the overall sales trend for January, equity peer groups (+€27.9 bn) dominated the flows by asset type on the table of the 10 best-selling peer groups by estimated net inflows. That said, it was still somewhat surprising to see only one bond classifications on the table of the 10 best-selling classifications for the month, given the general market sentiment. Given the overall fund flow trend in the European ETF industry, it was not surprising that Equity Global (+€9.4 bn) was the best-selling Lipper global classification for January. It was followed by Equity Emerging Markets Global (+€5.1 bn), Equity Europe (+€3.8 bn), Equity Sector Industrials (+€2.5 bn), and Equity Sector Materials (+€2.3 bn).
Generally speaking, it is not surprising that Equity Europe is on one of the top spots on the table of the 10 best-selling Lipper classifications given the overall market trend of increasing flows into ETFs investing in Europe and the good performance of European equities compared to their U.S. peers. In addition to this, it is also not surprising to see Equity Sector Industrials on the list of the 10 best-selling classifications for January, since the classification profited from the strong inflows into defense-related ETFs and the overall sector rotation toward classic value sectors. Conversely, it was surprising to see Equity U.S. on the second half of the table, since this classification is normally one of European investors favorites.
The general trend towards investing in money market products continued over the course of the month. Nevertheless, money market is in general not a core asset type within the European ETF industry. Therefore, it is still somewhat surprising to see a money market classification (Money Market EUR +€1.5 bn) on the table of the 10 best-selling classifications in the European ETF industry.
Graph 5: Ten Best- and Worst-Lipper Global Classifications by Estimated Net Sales, January 1 – January 31, 2026 (Euro Billions)
Source: LSEG Lipper
More generally, these numbers showed the European ETF segment is also highly concentrated when it comes to fund 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.
On the other side of the table, the 10 peer groups with the highest estimated net outflows for January accounted for €3.0 bn in outflows.
Commodity Precious Metals (-€0.7 bn) was the classification with the highest outflows for the month. It was bettered by Equity China (-€0.7 bn), Equity Australia (-€0.4 bn), Bond USD Government (-€0.3 bn), and Alternative Other (-€0.2 bn).
Assets Under Management by Promoters
A closer look at assets under management by promoters in the European ETF industry also showed high concentration, with only 33 of the 73 ETF promoters in Europe holding assets at or above €1.0 bn, accounting for €2,665.9 bn. The largest ETF promoter in Europe—iShares (€1,111.2 bn)—accounted for 41.55% of the overall assets under management. This number is far ahead of the number-two promoter—Amundi ETF (€344.3 bn)—and the number-three promoter—Xtrackers (€279.6 bn). (To earn more about the concentration of the European ETF market at the promoter level, please read our report: Review of the concentration of the assets under management in the European ETF industry on promoter level).
Graph 6: The 10 Largest ETF Promoters by Assets Under Management, January 31, 2026 (Euro Billions)
Source: LSEG Lipper
The 10-top promoters accounted for 92.34% of the overall assets under management in the European ETF industry. This meant, in turn, the other 63 fund promoters registering at least one ETF for sale in Europe accounted for only 7.66% of the overall assets under management.
ETF Flows by Promoters
Since the European ETF market is highly concentrated when it comes to assets under management by promoter, it was not surprising that nine of the 10 largest promoters by assets under management were among the 10-top selling ETF promoters for the month. iShares was the best-selling ETF promoter in Europe for January (+€18.0 bn), ahead of Amundi ETF (+€5.9 bn) and Vanguard (+€4.5 bn).
Graph 7: Ten Best-Selling ETF Promoters, January 1 – January 31, 2026 (Euro Billions)
Source: LSEG Lipper
The flows of the 10-top promoters accounted for estimated net inflows of €44.0 bn. As for the overall flow trend for January, it was clear that some of the 73 promoters (11) faced estimated net outflows (-€1.2 bn in total) over the course of the month.
Assets Under Management by ETFs
There were 4,685 instruments (primary share classes [2,325] and convenience share classes [2,360]) listed as ETFs in the Lipper database at the end of January. Regarding the overall market pattern, it was not surprising assets under management at the ETF level were also highly concentrated. Only 522 of the 2,325 ETFs (primary share classes = portfolios) held assets above €1.0 bn each. These ETFs accounted for €2,295.4 bn, or 85.82%, of the overall assets in the European ETF industry. The 10 largest ETFs in Europe accounted for €518.5 bn, or 19.39%, of the overall assets under management.
Graph 8: The 10 Largest ETFs by Assets Under Management, January 31, 2026 (Euro Billions)
Source: LSEG Lipper
Estimated Net Flows at ETF Level
A total of 1,378 of the 2,325 ETFs (primary share classes = portfolios) analyzed in this report showed net inflows of more than €10,000 each for January, accounting for inflows of €65.0 bn. This meant the other 947 instruments faced no flows, or net outflows, for the month. Upon closer inspection, only 178 of the 1,378 ETFs posting net inflows enjoyed inflows of more than €100 m over the course of January—for a total of €45.1 bn. The best-selling ETF for January Vanguard FTSE All-World UCITS ETF, which enjoyed estimated net inflows of €1.9 bn. It was followed by Amundi Smart Overnight Return UCITS ETF (+€1.2 bn) and iShares Core MSCI Emerging Markets IMI UCITS ETF (+€1.1 bn).
Graph 9: The 10 Best-Selling ETFs, January 1 – January 31, 2026 (Euro Billions)
Source: LSEG Lipper
The flow pattern at the fund level indicated there was a lot of turnover and rotation during the month, but it also showed the concentration of the European ETF industry even better than the statistics at the promoter or classification levels since the 10 best-selling ETFs account for inflows of €9.8 bn.
Given its size and the overall trend for net sales at the promoter level, it was not surprising that four of the 10 best-selling funds for January were issued by iShares. These iShares ETFs accounted for estimated net inflows of €3.4 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.
