Are ETFs Digging The Grave Of Traditional Mutual Funds? $2 Trillion Outflows Say So
A tectonic shift is underway in the asset-management industry, as investor disinterest in traditional mutual funds shows no signs of slowing.
Instead, capital is pouring into exchange-traded funds (ETFs), favored for their flexibility, lower fees and tax advantages, forcing legacy players like Vanguard and BlackRock Inc. (NYSE:BLK) to adapt.
The $11 trillion U.S. ETF market has now grown to more than half the size of the $19.8 trillion mutual fund industry. And momentum favors ETFs.
According to data shared by ETF.com, ETFs have earned nearly $2.5 trillion in assets since 2022, while mutual funds have lost over $2 trillion. This stark divergence reflects shifting investor preferences.
From January to April, mutual funds have suffered $255.9 billion in outflows, while ETFs have added $348.4 billion.
The difference in market activity is even more striking: 350 ETFs were launched through April 2025—ten times more than the 34 mutual funds launched during the same period.
The Vanguard Group, the world’s largest mutual fund company, has …
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