ETFs set new records
Here were the biggest trends in ETFs last year.
- 2024 ETF flows set a new annual record.
- ETF assets under management surpassed $10 trillion.
- Stock ETF flows surged as markets hit new all-time highs.
Multiple records were set by ETFs in 2024. Not only was it the biggest year for net flows (i.e., inflows less outflows), but total assets under management reached $10.4 trillion across more than 3,800 products.
Here were the biggest trends in ETF flows last year and where the momentum was at the outset of 2025.
Tidal wave of flows closed 2024
The record-setting year was enabled by an enormous second half. ETFs gathered $312 billion in net flows during Q4, after accumulating $292 billion during Q3. That brought 2024’s total sum to $1.1 trillion—an 89% increase over 2023, when ETFs accumulated roughly $600 billion. 2024’s total also topped the previous ETF flows annual record of just under $1 trillion in 2021.
Equity (e.g., stock) ETFs led all categories during the year, bringing in $722 billion in flows, led by broad-based index funds. As stock markets rallied to record highs, Q4 saw equity ETFs accrue an astounding $312 billion in flows.
Source: Fidelity Investments, as of January 8, 2025.
Within equity ETFs, sector-themed ETFs saw disparity heading into 2025. Q4 ETF flows were overwhelmingly positive for financials ($8.2 billion), tech ($6.5 billion), and industrials ($3.9 billion), while health care (-$3.4 billion), consumer staples (-$847 million), and real estate (-$625 million) ETFs experienced outflows.
On the fixed income (e.g., bond) ETF flows side, it was another year of strong momentum. Even though equity ETF flows have outpaced fixed income ETF flows 7 consecutive quarters, it was a huge year for the latter category. The $75 billion accumulated during Q4 fell short of Q3’s big haul, but combined, the 2 quarters helped propel fixed income ETFs to a $301 billion come in 2024.
Fixed income flows were led by aggregate bond ETFs ($127 billion) and corporate bond ETFs ($57 billion). Additionally, intermediate/long-duration ETF flows accounted for $89 billion, while short/ultrashort ETFs had $37 billion in flows.
Active flows underpin big year, crypto ETPs springboard
Of the ETF trends that prevailed during 2024, the ongoing growth of actively managed ETFs as well as the emergence of cryptocurrency ETPs stood out. Crypto ETPs (ETFs are a type of ETP) give you direct exposure to the price of a cryptocurrency without needing to actually buy the coin directly. Spot bitcoin ETPs are the first exchange-traded products that track the price of bitcoin by holding actual bitcoin (i.e., “spot”) as their underlying assets.
Actively managed ETFs, which unlike passively managed (i.e., index) ETFs are designed to outperform a benchmark, accounted for 27% ($299 billion) of ETF industry inflows, even though they only accounted for 9% of assets.
By market cap, flows were concentrated in large caps—particularly for passively managed ETFs. That was followed by flows into broad-market ETFs (i.e., those with exposure to multiple cap sizes), small caps, and finally mid caps.
Source: Fidelity Investments, Bloomberg, as of January 9, 2025.
On the crypto ETP front, it was a banner year. The 9 spot bitcoin exchange-traded products (ETPs) launched in January gathered $56 billion of inflows during 2024.1
Riding 2024’s crypto momentum, crypto ETPs debuted to massive demand and several were among the top-performing ETFs in terms of price performance during the year.
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Exchange-traded products (ETPs) are subject to market volatility and the risks of their underlying securities, which may include the risks associated with investing in smaller companies, foreign securities, commodities, and fixed income investments. Foreign securities are subject to interest rate, currency exchange rate, economic, and political risks, all of which are magnified in emerging markets. ETPs that target a small universe of securities, such as a specific region or market sector, are generally subject to greater market volatility, as well as to the specific risks associated with that sector, region, or other focus. ETPs that use derivatives, leverage, or complex investment strategies are subject to additional risks. The return of an index ETP is usually different from that of the index it tracks because of fees, expenses, and tracking error. An ETP may trade at a premium or discount to its net asset value (NAV) (or indicative value in the case of exchange-traded notes). The degree of liquidity can vary significantly from one ETP to another and losses may be magnified if no liquid market exists for the ETP's shares when attempting to sell them. Each ETP has a unique risk profile, detailed in its prospectus, offering circular, or similar material, which should be considered carefully when making investment decisions.
ETFs are subject to market fluctuation and the risks of their underlying investments. ETFs are subject to management fees and other expenses.
Spot crypto ETPs, are not investment companies registered under the Investment Company Act of 1940 (the “1940 Act”) nor are they commodity pools under the Commodity Exchange Act of 1936 (the “CEA”). As a result, shareholders of spot crypto ETPs do not have the protections associated with ownership of shares in a registered investment company nor are shareholders afforded the protections of investing in an CEA-regulated instrument or commodity pool.
Digital assets are highly volatile, and their market movements are very difficult to predict. Various market forces may impact their value including, but not limited to, supply and demand, investors’ faith and their willingness to purchase it using traditional currencies, investors’ expectations with respect to the rate of inflation, interest rates, currency exchange rates, an evolving legislative and regulatory environment in the U.S. and abroad, and other economic trends. Investors also face other risks, including significant and negative price swings, flash crashes, and fraud and cybersecurity risks. Digital assets may also be more susceptible to market manipulation than securities.
The performance of each fund or funds will not reflect the specific return an investor would realize if the investor actually purchased cryptocurrency. Investors in either fund will not have any rights that cryptocurrency holders have and will not have the right to receive any redemption proceeds in the underlying cryptocurrency.
1. This does not include GBTC, which had $22 billion in outflows in 2024.
All the data presented within are from Fidelity Investments and Bloomberg, as of October 10, 2024. These data do not reflect mutual fund data, and investors who would like to monitor the entire fund flow universe may want to consider flows going into or out of mutual funds.
Fidelity Investments® provides investment products through Fidelity Distributors Company LLC; clearing, custody, or other brokerage services through National Financial Services LLC or Fidelity Brokerage Services LLC; and institutional advisory services through Fidelity Institutional Wealth Adviser LLC