The exchange-traded fund (ETF) market has hit a historic milestone in 2024, with net inflows exceeding $913 billion as of November, marking the largest annual inflows ever recorded. The previous record of $910 billion, set in 2021, has now been surpassed with a month still left in the year, as per Bloomberg Intelligence data.
This is against the backdrop of an incredible investor appetite for ETFs, as these funds are cheaper, liquid, and more tax-efficient than ever. The overall assets under management for the US ETF market topped $10 trillion for the first time in September, with more than 600 new ETFs launched so far this year. Almost all US ETFs were in the black for 12-month returns as the market rebounded from lows.
During the second half of the year, in particular, momentum was very strong. For example, in the three days immediately after the US presidential election, investors plowed $53 billion into ETFs, compared to $16 billion following the 2020 elections.
The shift from traditional mutual funds to ETFs highlights changing investor preferences, as ETFs continue to attract both institutional and retail participants seeking diversified exposure at lower costs.
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Source: Moneycontrol
News Desk
