$1 Trillion Allocated To US ETFs In 2024, Setting New Record And Fueling Optimism For 2025

$1 Trillion Allocated To US ETFs In 2024, Setting New Record And Fueling Optimism For 2025

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Investors channeled over $1 trillion into U.S. exchange-traded funds or ETFs this year, setting a fresh record and fueling optimism for 2025, the WSJ  reported.

Total assets increased by a substantial 30% to a record $10.6 trillion through November, according to ETFGI data.

Meanwhile, S&P 500 funds reportedly saw the largest inflows, followed by the Nasdaq-tracking Invesco QQQ.

And stock fund inflows were notably more than double those of bond funds — but bond funds advanced at a considerably faster pace from their starting base. But one analyst has also pointed out that investors now risk becoming too concentrated in big tech and U.S. large-cap stocks.

Another analyst shared:

“In 2024, high interest rates slowed commercial real estate transactions, leaving investors searching for alternatives to deploy their capital. With U.S.-based ETFs seeing a record-breaking $1 trillion in inflows and other creative investment strategies gaining traction, the landscape for capital allocation has shifted dramatically.”

In other parts of the world, ETFs have won over “newcomers” as they invest into the stock market, the Autorité des Marchés Financiers (AMF) noted while adding that the the rise in ETFs which aim to track the performance of an index, in its Active Retail Investor Dashboards.

Its analysis of this trend and the concerned investors profile shows that younger investors are “inclined” to invest in ETFs.

In its quarterly update (shared in November 2024), the Autorité des Marchés Financiers (AMF) has noted a fourfold increase in just five years “between the second quarter of 2019 and the second quarter of 2024 of the number of French retail investors who have carried out at least one ETF transaction.”

To gain an understanding of this trend, the AMF analyzed transactions in all the securities “under its supervision, whether by French or European investors.”

This enabled AMF to observe differences in behavior on either side of the border in “relation to the equities and ETFs under its jurisdiction.”

A total of 266,300 French investors bought or sold ETFs “at least once in the second quarter of 2024.”

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