2025 was a year with record inflows for the global ETF industry.
These inflows occurred in a year in which global bond and equity markets were shaped by a combination of geopolitical instability, persistent fiscal pressures, and diverging monetary policy paths across major central banks. For global investors, the market narrative was one of cautious optimism punctuated by episodes of volatility as macro‑economic fault lines became more visible.
Geopolitical forces continued to exert a dominant influence on market sentiment. Nevertheless, it looked like financial markets largely shrugged off the initial shock from new U.S. tariff announcements in April even though underlying geopolitical and trade vulnerabilities remained elevated. Meanwhile, the intensifying U.S.–China tensions, sanctions, and structural divergences weighed on both U.S. and Chinese growth while the U.S. maintained relative strength.
For international equity investors, this backdrop translated into a preference for domestically oriented sectors and high‑quality balance sheets, as export‑heavy industries faced lingering uncertainty. As a result, ETFs investing in European equities witnessed strong estimated net flows. Supported by easing inflation and rising indices, the market sentiment across the major markets became more positive over the course of the year despite the somewhat weak economic momentum in key economies such as Germany and Italy and some geopolitical concerns.
More generally, equity markets witnessed a sector rotation as investors’ interest shifted from growth to value stocks. As a result, stocks from classic value sectors such as financials, energy, and industrials started to outperform high growth tech names. In addition to this, small and mid caps started to outperform large and mega caps over the course of the year.
Fiscal sustainability became a major theme influencing bond market performance. Widening government deficits were placing pressure on sovereign bond markets and raising the likelihood of yield increases as policymakers face growing challenges to maintain financial stability as market fragmentation and debt burdens were rising.
Global bond investors responded by demanding higher risk premia from fiscally vulnerable euro‑area members. Spreads widened at various points of the year, reflecting concerns around slow growth and budget slippage. In the U.S., repeated debates over government spending and shutdown risks contributed to periodic volatility in Treasuries, reinforcing global risk‑off sentiment during early year episodes.
The Federal Reserve reversed its policy to hold rates steady during its last three meetings for the year and cut the Fed funds rate by 25 basis points (bps) in each of those meetings, stating that the elevated economic uncertainty has led to concerns about rising unemployment due to the introduction of new tariffs and industrial policies by the U.S. government. The European Central Bank (ECB) also cut its deposit facility rate three times by 25 bps over the course of the year as the euro‑area inflation moved closer to target while economic growth stagnated in the euro area. Conversely, the Bank of Japan (BoJ) made a shift toward tighter monetary policies by raising interest rates to 0.75%, with two interest rate increases of 25 bps over the course of 2025. The 0.75% interest rate marks the highest interest rate over the course of the last 30 years in Japan.
Within this environment, gold has reasserted its role as investors’ preferred safe haven and as barometer of geopolitical risk, as the price of gold made an exceptional rally, gaining 65.2% over the course of the year as it reached $4,337.0 per ounce at the end of the year 2025. The rally of the silver price was even more impressive, as the price for an ounce of the second currency metal gained 150.1% over the course of the year. While the price for both precious metals was driven by economic and geopolitical uncertainties, the silver price was boosted by increasing industrial demand and a lack of supply.
Overall, it can be said that 2025 was a year of two halves, as the market sentiment on equity and bond markets was quite positive over the first half of the year, while the market sentiment was driven by uncertainty caused by renewed geopolitical, fiscal, and economic concerns.
Assets Under Management by Asset Type
From a global ETF industry perspective, the performance of the underlying markets led, in combination with the estimated net flows, to increasing assets under management (from $14,141.4 bn as of December 31, 2024, to $18,688.3 bn at the end of December 2025). At a closer look, the increase in assets under management of $4,546.9 bn for 2025 was driven by the performance of the underlying markets (+$2,452.4 bn), while estimated net inflows added (+$2,094.5 bn) to the increase in assets under management.
That said, the growth of the assets under management (AUM) in the global ETF industry is the best proof of success for the ETF industry since their inception.
Graph 1: Assets Under Management in the Global ETF Industry, January 1, 1990 – December 30, 2025 (USD billions)
Source: LSEG Lipper
As for the overall structure of the global ETF industry, it was not surprising equity ETFs ($14,273.8 bn) held the majority of assets, followed by bond ETFs ($3,156.0 bn), alternatives ETFs ($602.1 bn), commodities ETFs ($458.2 bn), money market ETFs ($103.2 bn), mixed-assets ETFs ($74.1 bn), and “other” ETFs ($21.0 bn).
Despite the current market environment, it is not surprising that the assets under management for all asset types with the exception of alternatives and “other” marked an all-time high at the end of December 2025.
Graph 2: Market Share, Assets Under Management in the Global ETF Industry by Asset Type, December 31, 2025
Source: LSEG Lipper
ETF Flows by Asset Type
The global ETF industry enjoyed strong inflows (+$2,094.5 bn) over the course of 2025. The monthly flow pattern over the course of the year shows that the inflows into ETFs slowed down after the announcement of the U.S. tariffs in April, but returned even stronger, as the tariffs had not become a major threat for economic growth during the following months.
Graph 3: Estimated Net Sales, January 1, 2025 – December 31, 2025 (USD Billions)
Source: LSEG Lipper
These impressive estimated net flows might be seen as proof that the acceptance and adoption of ETFs by global investors has further increased over the course of the year 2025.
The inflows in the global ETF industry for 2025 were driven by equity ETFs (+$1,294.6 bn), followed by bond ETFs (+$535.0 bn), alternatives ETFs (+$129.7 bn), commodities ETFs (+$79.4 bn), money market ETFs (+$35.3 bn), and mixed-assets ETFs (+$20.7 bn). On the other side of the table, “other” ETFs were the only asset type posting outflows (-$0.3 bn) for the year 2025.
Graph 4: Estimated Net Sales by Asset Type, January 1, – December 31, 2025 (USD Billions)
Source: LSEG Lipper
Given the market environment, it was no surprise to see high estimated net inflows into ETFs led by equity ETFs over the course of the year 2025.
Assets Under Management by Lipper Global Classifications
In order to examine the global ETF industry in further detail, a review of the Lipper global classifications will lead to more insights on the structure and concentration of assets within the global ETF industry. At the end of 2025, the global ETF market was split into 303 different peer groups. The highest assets under management at the end of the year were held by ETFs classified as Equity U.S. ($6,689.5 bn), followed by Equity Global ex U.S. ($1,103.8 bn), Equity U.S. Small & Mid Cap ($998.6 bn), Equity Global ($812.4 bn), and Equity Japan ($750.6 bn). These five peer groups accounted for 55.41% of the overall assets under management in the global ETF industry, while the 10-top classifications by assets under management accounted for 69.14%.
Overall, 16 of the 303 peer groups each accounted for more than 1% of assets under management. In total, these 16 peer groups accounted for $14,597.6 bn, or 78.11%, of the overall assets under management.
Graph 5: Ten Largest Lipper Global Classifications by Assets Under Management, December 31, 2025 (USD Billions)
Source: LSEG Lipper
The peer groups on the other side of the table showed some funds in the global 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 6: Ten Smallest Lipper Global Classifications by Assets Under Management, December 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 $1,360.4 bn. In line with the overall sales trend for 2025, equity peer groups (+$995.1 bn) gathered the majority of flows by asset type on the table of the 10 best-selling classifications by estimated net inflows for the year. That said, compared with the concentration of flows for the single regions, the 10 best-selling Lipper classifications are more diversified on the global level. This flow pattern is expected, as investors from other regions may have other preferences than U.S. investors.
Given the overall fund flow trend in the global ETF industry and the dominance of the U.S. as the leading market for ETFs, it was not surprising that Equity U.S. (+$611.5 bn) was the best-selling Lipper global classification for the year 2025. It was followed by Equity Global ex US (+$141.6 bn), Equity Global (+$121.5 bn), Bond USD Medium Term (+$98.3 bn), and Commodity Precious Metals (+$74.1 bn).
Since money market is in general not considered a core asset type within the global ETF industry, it is not surprising that there were no money market classifications on the table for the best-selling classifications for the global ETF industry.
More generally, these numbers showed the global ETF segment is somewhat highly concentrated when it comes to the estimated net flows by classification. Generally speaking, one would expect the flows into ETFs to be concentrated, even as investors around the globe may have different preferences, the main trends are normally global investment trends and investors 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, January 1- December 31 2025 (USD Billions)
Source: LSEG Lipper
On the other side of the table, the 10 peer groups with the highest estimated net outflows for the year accounted for $17.7 bn in outflows.
Equity Japan (-$4.9 bn) was the classification with the highest outflows for the year. It was bettered by Alternative Cryptocurrency (-$3.7 bn), Bond USD Mortgages (-$1.7 bn), Alternative Dedicated Short Bias (-$1.7 bn), and Equity Sector Financials (-$1.5 bn).
As the bottom of the table is dominated by sector or themed classifications, this shows that ETF investors around the globe seem to prefer broader classifications over those following a specific investment topic. Nevertheless, the outflows from Equity Sector Gold & Precious Metals are somewhat surprising given the upward trend for the price of gold.
Assets Under Management by Promoters
A closer look at assets under management by promoters in the global ETF industry also showed high concentration, with only 217 of the 787 ETF promoters covered in this report holding assets at or above $1.0 bn, totalling $18,591.0 bn at the end of 2025. The largest ETF promoter in the global ETF industry—iShares ($5,528.6 bn)—accounted for 29.58% of the overall assets under management, ahead of the number-two promoter—Vanguard ($4,256.3 bn)—and the number-three promoter—State Street SPDR ($1,990.2 bn).
Graph 8: The 10 Largest ETF Promoters by Assets Under Management, December 31, 2025 (USD Billions)
Source: LSEG Lipper
The 10-top promoters accounted for 79.45% of the overall assets under management in the global ETF industry. This meant, in turn, the other 777 ETF promoters which had registered at least one ETF for sale over the observation period accounted for only 20.55% of the overall assets under management. These numbers show that the assets under management at the promoter level in the global ETF industry are somewhat more diversified than in the single regions.
ETF Flows by Promoters
Since the global ETF industry is highly concentrated with regard 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 the year 2025. iShares was the best-selling ETF promoter in the global ETF industry for the year (+$532.1 bn), ahead of Vanguard (+$483.0 bn) and State Street SPDR (+$105.8 bn).
Graph 9: Ten Best-Selling ETF Promoters, January 1 – December 31, 2025 (USD Billions)
Source: LSEG Lipper
The flows of the 10-top promoters accounted for estimated net inflows of $1,508.7 bn. As for the overall flow trend in 2025, it was clear that some of the 787 promoters (185) faced estimated net outflows (-$4,509.0 bn in total) over the course of the year 2025.
Assets Under Management by Region
ETFs domiciled in North America ($14,048.1 bn) held the highest assets under management in the global ETF industry at the end of 2025. They were followed by ETFs domiciled in Europe ($3,028.7 bn), ETFs domiciled in the Asia Pacific region ($1,569.4 bn), ETFs domiciled in South and Central America ($25.5 bn), ETFs domiciled in Africa ($15.1 bn), while other domiciles held ($1.5 bn) in assets under management.
Graph 10: Assets Under Management in the Global ETF Industry by Region – December 31, 2025 (in bn USD)
Source: LSEG Lipper
These numbers showcase that the global ETF industry is a truly global industry with a high concentration of the assets under management in a few regions/domiciles.
Estimated Net Flows by Region
By reviewing the estimated flows in the global ETF industry by fund domicile and the respective regions, one needs to bear in mind that some domiciles have specific advantages or disadvantages when it comes to ETF distribution. The U.S. is, for example, a single market and can take profit from the size of the overall market, while in Europe every market is or at least can be an ETF domicile, which means that the local markets are much smaller.
That said, the EU countries have established a fund regulation (Undertakings in Collective Investments and Transferable Securities, or UCITS) which enables the fund and ETF industry to cross-list all products which are registered for sale in one EU country into another EU country. Since UCITS has become such a well-recognized regulatory standard for mutual funds and ETFs, some countries in South and Central America, as well in Asia, allow UCITS funds to be cross-listed and sold to local investors. It is fair to say that there is no other regulatory framework available that allows funds to be distributed in various countries around the globe. Other mutual recognition agreements, such as those between Hong Kong and China or Hong Kong and Taiwan, are only bilateral and have no global reach. This means that the estimated flows for European ETFs also include flows from South and Central America, as well as from Asia.
Graph 11: Estimated Net Flows in the Global ETF Industry by Region, January 1 – December 31, 2025 (in bn USD)
Source: LSEG Lipper
As one may expect from the assets under management, ETFs domiciled in North America (+$1,582.3 bn) enjoyed the highest estimated net inflows over the course of 2025. They were followed by ETFs domiciled in Europe (+$376.0 bn), Asia Pacific (+$130.7 bn), South and Central America (+$4.3 bn), ETFs domiciled in other regions (+$0.7 bn,), and Africa (+$0.5 bn).
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 the year 2025, the U.S. was the largest single country ETF domicile ($13,474.6 bn) of the 41 ETF domiciles covered in this report, followed by Ireland ($2,192.3 bn), Japan ($713.5 bn), Canada ($573.4 bn), and Luxembourg ($558.8 bn). These five ETF domiciles account for assets under management of $17,512.7 bn, or 93.71%, of the overall assets under management in the global ETF industry.
Graph 12: Ten Largest ETF Domiciles by Assets Under Management – December 31, 2025 (in bn USD)
Source: LSEG Lipper
These numbers show that the assets under management in the global ETF industry are dominated by a small number of domiciles. Obviously, this concentration is caused by the time period over which ETFs are available in the single domiciles, as well the overall market size of these domiciles. That said, Ireland and Luxembourg are true global ETF hubs since ETFs registered under the UCITS regulation can be sold in various markets around the world.
Estimated Net Flows by Domicile
In more detail, the U.S. (+$1,476.6 bn) was, as to be expected, the single fund domicile with the highest estimated net inflows for 2025. It was followed by Ireland (+$259.1 bn), Canada (+$105.7 bn), Luxembourg (+$87.5 bn), and South Korea (+$53.6 bn).
Graph 13: The 10 ETF Domiciles with the Highest Estimated Net Inflows, January 1 – December 31, 2025 (in bn USD)
Source: LSEG Lipper
The list of the 10 best-selling domiciles does an even better job of showcasing that ETFs are truly a global phenomenon since it shows that investors around the globe are using ETFs to implement their asset allocation views into their portfolios.
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.
