Exchange-Traded Fund Market Size, Share, Trends by 2031
The exchange-traded fund market size is expected to grow from US$ 10.23 trillion in 2023 to US$ 26.45 trillion by 2031; it is anticipated to expand at a CAGR of 12.6% from 2023 to 2031. The growing popularity of bond exchange-traded fund is expected to offer high growth opportunities.
Exchange-Traded Fund Market Analysis
Exchange-traded funds constitute a small proportion of the total global financial market in both fixed-income and equities, ranging from 0.4%-3.0% of fixed-income assets and 4-15% of equities by region. The advantages of ETFs over mutual funds include lower costs, the prospect of tracking the performance of the entire market rather than investing in single stocks, and in theory better investment outcomes, as active fund managers tend to underperform the market. These benefits have led to a surge in the number of these funds worldwide, growing at an astonishing ~3,000% since 2003, and driving the exchange-traded fund market growth.
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Exchange-Traded Fund Market: Strategic Insights
Market Size Value in US$ 10.23 trillion in 2023 Market Size Value by US$ 26.45 trillion by 2031 Growth rate CAGR of 12.6% from 2023 to 2031 Forecast Period 2023-2031 Base Year 2023
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Exchange-Traded Fund Market: Strategic Insights
| Market Size Value in | US$ 10.23 trillion in 2023 |
| Market Size Value by | US$ 26.45 trillion by 2031 |
| Growth rate | CAGR of 12.6% from 2023 to 2031 |
| Forecast Period | 2023-2031 |
| Base Year | 2023 |
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Exchange-Traded Fund
Industry Overview
- An exchange-traded fund is a kind of pooled investment security that can be purchased and sold much like an individual stock. The main difference between an exchange-traded fund and a mutual fund is that though a mutual fund is also a pooled investment, it trades only once a day after the market close.
- The first exchange-traded fund was the SPDR S&P 500 ETF (SPY), which tracks the S&P 500 Index and is still a popular exchange-traded fund with investors and traders today.
Exchange-Traded Fund Market Drivers and Opportunities
Shift from Traditional Loaning to Exchange-Traded Fund to Drive the Exchange-Traded Fund Market
- Exchange-traded funds are renowned for their easy liquidity options. Liquidity is an indispensable aspect of investing, providing investors with straightforward buying and selling. Regarding exchange-traded funds, liquidity is of significant importance.
- Exchange-traded fund’s liquidity refers to the ease with which investors can trade or exchange these funds. These funds are considered multifaceted asset baskets. Therefore, the higher the liquidity of each underlying asset comprising an exchange-traded fund, the easier it will be to redeem the entire exchange-traded fund.
- Exchange-traded funds feature two liquidity components - underlying asset liquidity and exchange-traded fund liquidity. Due to their complex redemption/creation procedures, most exchange-traded funds measure their liquidity in reference to their underlying assets and may include bonds, stocks, gold, etc.
Exchange-Traded Fund
Market Report Segmentation Analysis
- Based on type, the exchange-traded fund market is segmented into commodity ETF, equity ETF, fixed Income ETF, real estate ETF, and others.
- The equity ETF segment is expected to hold a substantial exchange-traded fund market share in 2023. These are simple investment products that unite the elasticity of stock investment and the simplicity of equity mutual funds. Exchange-traded funds trade on the cash market of the stock exchange, similar to any other stock, and can be purchased and sold continuously at market prices. These are passive investment instruments, based on indices and invest in securities in the same ratio as the original index. Because of its index mirroring characteristic, there is full transparency on the holdings of an exchange-traded fund. Further due to its distinctive structure and creation mechanism, the exchange-traded funds have much lower expense ratios as compared to mutual funds. Such advantages are anticipated to boost the exchange-traded fund market growth.
Exchange-Traded Fund
Market Share Analysis By Geography
The scope of the exchange-traded fund market report is primarily divided into five regions - North America, Europe, Asia Pacific, Middle East & Africa, and South America. Asia Pacific (APAC) is experiencing rapid growth, but North America is anticipated to hold the largest exchange-traded fund market share. APAC’s significant economic development and growing interest in trading have presented substantial opportunities for exchange-traded funds to expand.
Exchange-Traded Fund
Market Report Scope
The "Exchange-Traded Fund Market Analysis" was carried out based on type and geography. In terms of type, the market is segmented into commodity ETF, equity ETF, fixed Income ETF, real estate ETF, and others. Based on geography, the market is segmented into North America, Europe, Asia Pacific, the Middle East & Africa, and South America.
Exchange-Traded Fund
Market News and Recent Developments
Companies adopt inorganic and organic strategies such as mergers and acquisitions in the exchange-traded fund market. A few recent key market developments are listed below:
- In March 2024, Asset manager VanEck announced the waiver of its sponsor fee for the VanEck Bitcoin Trust (HODL), which provides exposure to spot bitcoin, effective immediately. This adjustment demonstrates VanEck's commitment to delivering enhanced value to investors, including through competitive pricing. During the period starting March 12, 2024, and ending on March 31, 2025, the entire sponsor fee will be waived for the first US$ 1.5 billion of the Trust’s assets. If the Trust’s assets exceed US$ 1.5 billion prior to March 31, 2025, the fee on assets over US$ 1.5 billion will be 0.20%. All investors will incur the same sponsor fee, which is the weighted average of those fee rates. After March 31, 2025, the sponsor fee will be 0.20%.
[Source: VanEck, Company Website]
- In March 2024, digital asset manager Grayscale Investments on filed for a spin-off of its spot bitcoin exchange-traded fund, the Grayscale Bitcoin Trust (GBTC). The spin-off is part of a bid to offer investors lower-fee exposure to bitcoin. Grayscale filed to list shares of a new investment product, the Grayscale Bitcoin Mini Trust, which will receive a certain amount of bitcoin held by GBTC. In exchange, current GBTC shareholders will get stock in the Mini Trust.
[Source: Grayscale, Company Website]
Exchange-Traded Fund
Market Report Coverage & Deliverables
The market report on “Exchange-Traded Fund Market Size and Forecast (2021–2031)”, provides a detailed analysis of the market covering below areas-
- Market size & forecast at global, regional, and country- level for all the key market segments covered under the scope.
- Market dynamics such as drivers, restraints, and key opportunities.
- Key future trends.
- Detailed PEST & SWOT analysis
- Global and regional market analysis covering key market trends, key players, regulations, and recent market developments.
- Industry landscape and competition analysis covering market concentration, heat map analysis, key players, recent developments.
- Detailed company profiles.
Report Coverage
Revenue forecast, Company Analysis, Industry landscape, Growth factors, and Trends
Segment Covered
Type and Geography
Regional Scope
North America, Europe, Asia Pacific, Middle East & Africa, South & Central America
Country Scope
This text is related
to country scope.
Frequently Asked Questions
The key players holding majority shares in the market are BlackRock Inc, Fidelity Investments Inc, Goldman Sachs, JPMorgan Chase and Co, and The Vanguard Group.
The market is expected to reach US$ 26.45 trillion by 2030.
The global market was estimated to be US$ 10.23 trillion in 2023 and is expected to grow at a CAGR of 12.6 % during the forecast period 2023 - 2031.
The growth of bond exchange-traded funds is anticipated to play a significant role in the global market in the coming years.
Rising demand for easily liquifiable fund options for choosing varied assets for fund allocation are the major factors that propel the market.
- Allianz Group
- BlackRock Inc
- BNY Mellon Corporation
- Fidelity Investments Inc
- Goldman Sachs
- JPMorgan Chase and Co
- Mirae Asset Securities Co Ltd
- Morgan Stanley
- The Vanguard Group
- UBS Group
The Insight Partners performs research in 4 major stages: Data Collection & Secondary Research, Primary Research, Data Analysis and Data Triangulation & Final Review.
- Data Collection and Secondary Research:
As a market research and consulting firm operating from a decade, we have published many reports and advised several clients across the globe. First step for any study will start with an assessment of currently available data and insights from existing reports. Further, historical and current market information is collected from Investor Presentations, Annual Reports, SEC Filings, etc., and other information related to company’s performance and market positioning are gathered from Paid Databases (Factiva, Hoovers, and Reuters) and various other publications available in public domain.
Several associations trade associates, technical forums, institutes, societies and organizations are accessed to gain technical as well as market related insights through their publications such as research papers, blogs and press releases related to the studies are referred to get cues about the market. Further, white papers, journals, magazines, and other news articles published in the last 3 years are scrutinized and analyzed to understand the current market trends.
- Primary Research:
The primarily interview analysis comprise of data obtained from industry participants interview and answers to survey questions gathered by in-house primary team.
For primary research, interviews are conducted with industry experts/CEOs/Marketing Managers/Sales Managers/VPs/Subject Matter Experts from both demand and supply side to get a 360-degree view of the market. The primary team conducts several interviews based on the complexity of the markets to understand the various market trends and dynamics which makes research more credible and precise.
A typical research interview fulfils the following functions:
- Provides first-hand information on the market size, market trends, growth trends, competitive landscape, and outlook
- Validates and strengthens in-house secondary research findings
- Develops the analysis team’s expertise and market understanding
Primary research involves email interactions and telephone interviews for each market, category, segment, and sub-segment across geographies. The participants who typically take part in such a process include, but are not limited to:
- Industry participants: VPs, business development managers, market intelligence managers and national sales managers
- Outside experts: Valuation experts, research analysts and key opinion leaders specializing in the electronics and semiconductor industry.
Below is the breakup of our primary respondents by company, designation, and region:
Once we receive the confirmation from primary research sources or primary respondents, we finalize the base year market estimation and forecast the data as per the macroeconomic and microeconomic factors assessed during data collection.
- Data Analysis:
Once data is validated through both secondary as well as primary respondents, we finalize the market estimations by hypothesis formulation and factor analysis at regional and country level.
- 3.1 Macro-Economic Factor Analysis:
We analyse macroeconomic indicators such the gross domestic product (GDP), increase in the demand for goods and services across industries, technological advancement, regional economic growth, governmental policies, the influence of COVID-19, PEST analysis, and other aspects. This analysis aids in setting benchmarks for various nations/regions and approximating market splits. Additionally, the general trend of the aforementioned components aid in determining the market's development possibilities.
- 3.2 Country Level Data:
Various factors that are especially aligned to the country are taken into account to determine the market size for a certain area and country, including the presence of vendors, such as headquarters and offices, the country's GDP, demand patterns, and industry growth. To comprehend the market dynamics for the nation, a number of growth variables, inhibitors, application areas, and current market trends are researched. The aforementioned elements aid in determining the country's overall market's growth potential.
- 3.3 Company Profile:
The “Table of Contents” is formulated by listing and analyzing more than 25 - 30 companies operating in the market ecosystem across geographies. However, we profile only 10 companies as a standard practice in our syndicate reports. These 10 companies comprise leading, emerging, and regional players. Nonetheless, our analysis is not restricted to the 10 listed companies, we also analyze other companies present in the market to develop a holistic view and understand the prevailing trends. The “Company Profiles” section in the report covers key facts, business description, products & services, financial information, SWOT analysis, and key developments. The financial information presented is extracted from the annual reports and official documents of the publicly listed companies. Upon collecting the information for the sections of respective companies, we verify them via various primary sources and then compile the data in respective company profiles. The company level information helps us in deriving the base number as well as in forecasting the market size.
- 3.4 Developing Base Number:
Aggregation of sales statistics (2020-2022) and macro-economic factor, and other secondary and primary research insights are utilized to arrive at base number and related market shares for 2022. The data gaps are identified in this step and relevant market data is analyzed, collected from paid primary interviews or databases. On finalizing the base year market size, forecasts are developed on the basis of macro-economic, industry and market growth factors and company level analysis.
- Data Triangulation and Final Review:
The market findings and base year market size calculations are validated from supply as well as demand side. Demand side validations are based on macro-economic factor analysis and benchmarks for respective regions and countries. In case of supply side validations, revenues of major companies are estimated (in case not available) based on industry benchmark, approximate number of employees, product portfolio, and primary interviews revenues are gathered. Further revenue from target product/service segment is assessed to avoid overshooting of market statistics. In case of heavy deviations between supply and demand side values, all thes steps are repeated to achieve synchronization.
We follow an iterative model, wherein we share our research findings with Subject Matter Experts (SME’s) and Key Opinion Leaders (KOLs) until consensus view of the market is not formulated – this model negates any drastic deviation in the opinions of experts. Only validated and universally acceptable research findings are quoted in our reports.
We have important check points that we use to validate our research findings – which we call – data triangulation, where we validate the information, we generate from secondary sources with primary interviews and then we re-validate with our internal data bases and Subject matter experts. This comprehensive model enables us to deliver high quality, reliable data in shortest possible time.
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