Active ETFs Capture 42% of All Inflows, Up from 26% in 2024

Exchange‑traded funds (ETFs) have virtually become synonymous with passive investing. As a result, many investors looking to gain exposure to index funds naturally gravitate toward ETFs.

The relationship between ETFs and passive, or index‑based, investing helped position the asset class as a challenge to active mutual funds. This perception was reinforced by ETFs’ ability to trade throughout the entire trading day, their tax advantages over mutual funds (such as limited capital‑gains distributions), and generally lower expense ratios.

This highlights the strengths of the ETF wrapper, explaining why numerous investors evaluating how to invest in mutual funds often switch to ETFs. Rather than competing solely in the ultra‑price‑sensitive passive ETF space, many asset managers are revitalizing active management by offering it through ETFs.

The data supports this trend: in the first quarter, investors allocated $245.2 billion to U.S.‑listed active ETFs, surpassing previous records. Momentum persisted into the current year, with actively managed U.S. ETFs attracting roughly $63.6 billion in new assets last month, pushing the year‑to‑date total to $466.8 billion—significantly ahead of the $263 billion recorded during the same period in 2025.

The surge of capital into active ETFs is poised to influence both fund managers and individual stock investors, potentially reshaping the fortunes of several well‑known firms over the coming years.

Prominent Players Dominate the Active ETF Landscape

An inventory of the biggest active ETFs showcases many industry leaders, yet a significant portion of the top firms are privately held, such as Dimensional Fund Advisors and Fidelity. Meanwhile, Vanguard — historically the champion of low‑cost passive investing — is emerging as a notable player in the active ETF arena.

Among publicly traded leaders in active ETFs, BlackRock (NYSE: BLK) and JPMorgan Chase (NYSE: JPM) stand out as marquee names. JPMorgan’s extensive suite of active bond and options‑income funds enables it to sponsor some of the nation’s largest non‑passive ETFs. As the United States’ biggest bank, JPMorgan operates across many sectors, and its ETF division, while successful, accounts for only a modest share — approximately 1 % — of the bank’s total earnings.

BlackRock operates on a different scale. As of June, the firm managed $3.6 trillion in active assets across ETFs and other vehicles, and analysts project that globally active ETF assets could reach $4.2 trillion by 2030. Moreover, BlackRock is increasingly integrating active ETFs into its model portfolios, signaling that these products are central to its long‑term growth strategy.

Another publicly traded firm worth watching in the active ETF space is T. Rowe Price (NASDAQ: TROW), which has risen 9.6 % year‑to‑date. While its stock performance has been modest, this may reflect a market that has yet to fully recognize the company’s expanding active ETF narrative.

With a long history of managing actively managed mutual funds, T. Rowe Price is applying that expertise to the active ETF market. Rather than creating a new offering from scratch, the firm often launches ETF versions of its existing mutual funds, preserving the same brand and management teams. This familiarity can be appealing to investors, suggesting that active ETFs may further bolster T. Rowe Price’s long‑term growth trajectory.

Not All Issuers Face Vulnerability: The Case of BEN

Franklin Templeton (NYSE: BEN), which was once viewed as potentially at risk, has gained 42.2 % year‑to‑date, underscoring the success of its sustained transition to both active and passive ETFs. The company also boasts a portfolio of respected fund brands, such as Brandywine, Putnam, and Royce.

This development offers a potential upside for long‑term investors as the company’s active ETF narrative matures and the market increasingly recognizes its contribution to share‑price appreciation.

Asset managers facing perceived vulnerability have strategies to address investor concerns and enhance share‑price performance. They can emulate T. Rowe Price by launching ETF versions of existing mutual funds or creating ETF share classes for established funds. Vanguard’s earlier use of this approach helped it become a leading ETF issuer; its patent on the method expired in 2023, a fact well known throughout the industry.

Is Now an Appropriate Moment to Purchase BlackRock Shares?

Before you contemplate adding BlackRock to your portfolio, it is wise to evaluate a few key factors.

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