2017 Was Another Banner Year For Passive Fund Flows
Supporting Image for Blog Post

 
View from the Observation Deck  
  1. Investors directing capital into mutual funds and exchange traded funds (ETFs) favored passive investing over active management on a massive scale in 2017. 
  2. Passive mutual funds and ETFs reported net inflows totaling $691.6 billion, compared to net outflows totaling $7.0 billion for those actively managed (see chart).
  3. From 2014-2017, net inflows to passive funds totaled $2.0 trillion, compared to net outflows totaling $509.5 billion for active funds (not shown in chart), according to Morningstar. 
  4. In 2017, the one area of the market where sizable net inflows to active funds matched net inflows to passive funds was bonds (taxable + municipal). Net inflows to active funds totaled $207.4 billion, compared to $215.3 billion for passive funds.  
  5. We intend to monitor net flows moving forward.
This chart is for illustrative purposes only and not indicative of any actual investment. 

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Posted on Thursday, January 25, 2018 @ 12:18 PM

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.