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The ETF market share is expected to increase by USD 10.20 billion from 2021 to 2026, and the market’s growth momentum will accelerate at a CAGR of 14.56%.
This ETF market research report provides valuable insights on the post COVID-19 impact on the market, which will help companies evaluate their business approaches. Furthermore, this report extensively covers ETF market segmentation by type (fixed income ETF, equity ETF, commodity ETF, real estate ETF, and others) and geography (North America, Europe, APAC, South America, and the Middle East and Africa). The ETF market report also offers information on several market vendors, including Allianz Group, Amundi Austria GmbH, Betterment LLC, BlackRock Inc., Fidelity Investments Inc., Invesco Ltd., JPMorgan Chase and Co., Mirae Asset Securities Co. Ltd., Morgan Stanley, Morningstar Inc., State Street Corp., The Bank of New York Mellon Corp., Blackstone Inc., The Charles Schwab Corp., The Goldman Sachs Group Inc., The Vanguard Group Inc., UBS Group AG, and Wealthfront Corp. among others.
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The market liquidity is notably driving the ETF market growth, although factors such as transaction risks may impede the market growth. Our research analysts have studied the historical data and deduced the key market drivers and the COVID-19 pandemic impact on the ETF industry. The holistic analysis of the drivers will help deduce end goals and refine marketing strategies to gain a competitive edge.
Key ETF Market Driver
Market liquidity is one of the major drivers impacting ETF market growth. Liquidity can be described as the ease with which an asset can be quickly and efficiently bought or sold in the market without significantly affecting its price. ETF is one of the easily liquidated financial markets. This is attributed to the composition and the trading volume of ETF. Generally, ETF is invested in small-cap, mid-cap, and large-cap markets where the large-cap has the highest liquidity. Besides, in the asset class, the ETF investors have the option to choose from a wide range of assets, such as equities and fixed income, which are highly liquid. Thus, ETFs with actively traded securities such as S&P 500 SPDR (SPY), Invesco QQQ (QQQ), and Financial Select SPDR (XLF) are highly liquid when compared to mutual funds. Therefore, high liquidity is expected to drive the growth of the market during the forecast period.
Key ETF Market Trend
The growth of bond ETFs is one of the major trends influencing the ETF market growth. There is high growth potential in bond ETFs as institutions find it more difficult to access individual bonds. To facilitate large transactions, investors are likely to use bond ETFs instead of single securities. Bond ETFs also allow efficient trading of securities that would otherwise be difficult and expensive to access individually. According to BlackRock Inc., one of the major vendors in the global ETF market, trading individual bonds from more than 50 countries can be as much as 65 times more expensive than bond ETFs. Therefore, more investors are expected to show interest in bond ETFs, which will further fuel the growth of the market during the forecast period.
Key ETF Market Challenge
Transaction risks are one of the major challenges impeding the ETF market growth. Transaction risks occur when a corporation conducts financial transactions or keeps financial records in a currency other than the one on which it is based. A corporation established in Canada that does business in China, for example, is subject to foreign exchange risks because it accepts financial transactions in Chinese yuan and presents its financial statements in Canadian dollars. The risks faced by a corporation while performing financial transactions between countries are known as transaction risks. The risk is that the currency rate will change before the transaction is completed. The duration between a transaction and a settlement is, in essence, the source of the transaction risks. Forward contracts and options can be used to reduce transaction risks. Such transaction risks may hinder the market growth during the forecast period.
This ETF market analysis report also provides detailed information on other upcoming trends and challenges that will have a far-reaching effect on the market growth. The actionable insights on the trends and challenges will help companies evaluate and develop growth strategies for 2022-2026.
Technavio categorizes the global ETF market as a part of the global specialized consumer services market. Our research report has extensively covered external factors influencing the parent market growth potential in the coming years, which will determine the levels of growth of the ETF market during the forecast period.
The report analyzes the market’s competitive landscape and offers information on several market vendors, including:
This statistical study of the ETF market encompasses successful business strategies deployed by the key vendors. The ETF market is fragmented and the vendors are deploying growth strategies such as M&A to compete in the market.
To make the most of the opportunities and recover from post COVID-19 impact, market vendors should focus more on the growth prospects in the fast-growing segments, while maintaining their positions in the slow-growing segments.
The ETF market forecast report offers in-depth insights into key vendor profiles. The profiles include information on the production, sustainability, and prospects of the leading companies.
Our report provides extensive information on the value chain analysis for the ETF market, which vendors can leverage to gain a competitive advantage during the forecast period. The end-to-end understanding of the value chain is essential in profit margin optimization and evaluation of business strategies. The data available in our value chain analysis segment can help vendors drive costs and enhance customer services during the forecast period.
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40% of the market’s growth will originate from North America during the forecast period. The US is the key market for the ETF market in North America. Market growth in this region will be slower than the growth of the market in other regions.
The continuous trading activities in the region and the large presence of the equity market in the US will facilitate the ETF market growth in North America over the forecast period. This market research report entails detailed information on the competitive intelligence, marketing gaps, and regional opportunities in store for vendors, which will assist in creating efficient business plans.
COVID Impact and Recovery Analysis
The ETF market in North America showed high resilience during the pandemic in 2020. Though the market witnessed various challenges due to the pandemic, trading activities in the market were not affected by the pandemic. For instance, in the US, fixed income ETF volumes reached an average of $33.5 billion per day in March 2020, an increase of more than three times that in March 2019. Due to the high transparency of the ETF market, investors were showing interest in the regional market.
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The ETF market share growth in the fixed income ETF segment will be significant during the forecast period. Fixed income ETF dominates the market in focus. Fixed income ETF is a type of bond fund which invests in various fixed-income securities, such as corporate, municipal bonds, treasury bonds, and others, on the stock exchange.
This report provides an accurate prediction of the contribution of all the segments to the growth of the ETF market size and actionable market insights on post COVID-19 impact on each segment.
ETF Market Scope |
|
Report Coverage |
Details |
Page number |
120 |
Base year |
2021 |
Forecast period |
2022-2026 |
Growth momentum & CAGR |
Accelerate at a CAGR of 14.56% |
Market growth 2022-2026 |
$ 10.20 billion |
Market structure |
Fragmented |
YoY growth (%) |
14.41 |
Regional analysis |
North America, Europe, APAC, South America, and the Middle East and Africa |
Performing market contribution |
North America at 40% |
Key consumer countries |
US, China, Japan, UK, and France |
Competitive landscape |
Leading companies, Competitive strategies, Consumer engagement scope |
Key companies profiled |
Allianz Group, Amundi Austria GmbH, Betterment LLC, BlackRock Inc., Fidelity Investments Inc., Invesco Ltd., JPMorgan Chase and Co., Mirae Asset Securities Co. Ltd., Morgan Stanley, Morningstar Inc., State Street Corp., The Bank of New York Mellon Corp., Blackstone Inc., The Charles Schwab Corp., The Goldman Sachs Group Inc., The Vanguard Group Inc., UBS Group AG, and Wealthfront Corp. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID 19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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