U.S. Exchange-Traded Fund Markets 2025
Active Product Development Meets Demand
Explore ETF Product Innovation
- Analyze issuer buildout of sustainable and thematic ETF product lines
- Evaluate issuer use of index providers, including smaller firms and self-indexing
- Review enhanced coverage of direct channel and institutional use of ETFs
- Review ETF product distribution trends, including sales organizational structures and strategic partnerships with intermediaries
- Gain insight into the Canadian ETF market, strategic product development plans, distribution channel sizing, and challenges surrounding growth and distribution
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Summary
Examine the U.S. exchange-traded product industry from the perspective of existing issuers and new entrants, as well as those using their products, including advisors, institutions, and households. Monitor ongoing industry trends such as fee compression, the shift toward a wider variety of products, including actively managed equity (transparent and semi-transparent) and fixed-income ETFs, and identify other product trends.
A Note from the Author
Active ETFs: Maximizing Distribution Potential
Kevin Lyons
Senior Analyst
Bio →
Kevin Lyons
Senior Analyst
Kevin is a Senior Analyst in the Product Development practice at Cerulli, focusing on trends related to asset managers' product strategy, development, and management functions. This broadly includes assessing the opportunity for product line expansion, evaluating emerging product trends, assessing optimal pricing strategy, and understanding distribution and product positioning for investment products across retail and institutional channels. As a Senior Analyst, Kevin oversees Cerulli's Exchange-Traded Fund Markets Report and contributes to various reports, including the U.S. Alternative Investments, U.S. Product Development, and U.S. Asset Allocation Model Portfolios reports. He also plays a role in the quarterly Cerulli Edge: Product Development Edition and contributes to related consulting engagements.
Full biography here.
As development of active ETFs progresses, ETF issuers will need to maintain collaboration with wealth management teams to boost product placement, enhance educational resources, and tackle potential challenges for successful distribution. Here’s what you should know:
- Active ETF assets ballooned to $1.17 trillion as of 2Q 2025 compared to just $71 billion in 2018. In the first half of 2025, active ETFs saw net flows of $197 billion, on pace to shatter the $279 billion in flows for the entire year in 2024.
- As use and development of active ETF products grows, ETF issuers are working to address perceived obstacles in their distribution models. According to Cerulli, 71% of ETF issuers agree that it is difficult to attain shelf space for active ETF product on broker/dealer platforms and 58% agree that advisors require additional education on use of active ETFs.
- While most asset managers still employ a generalist model, where a wholesaler works in conjunction with a team of specialists, it is imperative that these asset managers continue to incorporate readily available data on advisor product use to adapt their strategy to best cover these advisors.
- Asset managers and ETF issuers that can best align their salesforce with the changing product usage by advisors will be in the best position for success as active ETFs continue to enter the marketplace.
To learn how to enhance your distribution capabilities in an increasingly competitive landscape, access The Cerulli Report—U.S. Exchange-Traded Fund Markets 2025.
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