Active ETFs Now Outnumber Passive Funds in Industry Watershed

The ETF market has hit a symbolic turning point: active funds now outnumber passive ones for the first time, marking a sharp break from the industry’s index-tracking origins — even if actively managed assets still account for just a tenth of assets.

Roughly 51% of the nearly 4,300 US-listed exchange-traded funds are ones overseen by fund managers who have more discretion to pick stocks or other securities, eclipsing index-following products for the first time, Bloomberg Intelligence data show. The number of active ETFs has more than doubled in the past five years, from just 23% in 2020.

It’s another ...