- Active ETF assets have surged over 600% since 2019, reaching $631 billion in 2024.
- Broadridge projects active ETF assets to hit $1.2 trillion by 2027, indicating significant growth potential.
- Only 11% of new active ETFs managed to surpass $100 million in their first year.
Broadridge Financial Solutions (BR, Financial), a prominent fintech leader, has unveiled a whitepaper revealing that active ETF assets have experienced a substantial increase, growing by over 600% from $81 billion in 2019 to $631 billion in 2024. This remarkable growth trajectory is expected to continue, with projections suggesting that active ETF assets will nearly double to $1.2 trillion by 2027.
Despite the favorable growth environment, challenges remain as only 11% of the 660 active ETFs launched in 2024 exceeded the $100 million threshold within their first year. Furthermore, the market remains heavily concentrated, with the top 10 active asset managers controlling 77% of total active ETF assets. Currently, active ETFs constitute just 6% of total active assets under management (AUM), indicating room for further expansion.
The whitepaper outlines three key principles for successful active ETF launches. First, "Go with the Flow" by focusing on robust distribution within RIA channels, which form the bulk of active ETF assets. Second, "Pick a Lane" by capitalizing on unique strengths such as innovative investment strategies and strong brand identity. Lastly, "Less is More" by targeting high-potential advisors already utilizing active ETFs, enhancing conversion rates and gross sales.
Broadridge's insights and analytics, derived from actual investment data, offer a comprehensive view of the evolving asset management industry. As a trusted market intelligence source, Broadridge is well-positioned to assist financial services firms in navigating the dynamic landscape of active ETFs.
