Active ETFs pulled in nearly $400 billion in net inflows during 2025. That has industry veterans calling the adoption “remarkable.” It signals a fundamental shift in how investors access professional money management.
The surge comes as passive strategies collected about $750 billion, meaning active ETFs captured more than one-third of total industry inflows this year, according to Paul Baiocchi, head of fund sales and strategy at SS&C ALPS Advisors, during November 11’s episode of ETF Prime.
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What makes the trend particularly striking is that the growth is happening through fully transparent active ETFs. That is as opposed to the semitransparent structures many expected would lead the charge, according to Baiocchi. The shift reflects a transition for advisors who have traditionally used active managers but are now accessing those strategies in a more tax-efficient wrapper.
Baiocchi pointed to fixed income as one category where investors are recognizing active managers can add value through security selection and duration management. The approval of the ETF share class structure should act as “jet fuel” for the active adoption trend, he said.
The ETF share class story had been talked about for years without materializing. It has now become “real and tangible” following regulatory approvals, according to Baiocchi. He described the years of anticipation as feeling like “the boy who cried wolf.”
Thematics Return From the Dead
The most surprising development of 2025 was the return of thematic ETFs. Baiocchi described this category as “dead in the water” following the 2022 market drawdown. Thematic strategies have attracted $41 billion in net inflows this year. Those inflows have spanned disruptive technology, infrastructure, and natural resources, according to Baiocchi.
The comeback shows investors looking beyond traditional cap-weighted indexes to find exposure to companies before they become dominant index holdings. SS&C ALPS Advisors launched the ALPS Electrification Infrastructure ETF (ELFY) in April. It has already reached $100 million in assets by focusing on beneficiaries of electrification in sectors like utilities and materials that are underowned in the S&P 500, according to Baiocchi.
Gold ETFs also made a comeback in 2025, with inflows into both physical gold ETFs and gold mining strategies signaling investors are reevaluating their asset allocations, according to Baiocchi.
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