ETFs Take Over as Advisors Flock to Niche Strategies

Advisors are increasingly investing in exchange-traded funds (ETFs), with assets projected to surpass mutual funds by 2030. Thematic, high-fee, and tactical ETFs are performing well, with Eldridge and BondBloxx Investment Management seeing significant growth. Niche strategies are popular among younger advisor teams, signaling a market shift towards alternative investments.

Pacer’s US Large Cap Cash Cows Growth Leaders ETF (COWG) experienced the most growth at 46%, followed by Eldridge’s BBB-B CLO ETF (CLOZ) at 42%, and Simplify’s Managed Futures Strategy ETF (CTA) at 41%. First Trust Advisors’ Cboe Vest U.S. Equity Moderate Buffer ETF (GFEB) and BlackRock’s AAA CLO ETF (CLOA) were also among the fastest-growing ETFs.

The trend towards niche strategies and ETFs over mutual funds is driven by their lower cost and increased liquidity. RIAs are incorporating ETFs into their portfolios, with mutual fund companies also adopting ETFs. As market volatility persists, ETFs are becoming more attractive due to their performance and liquidity advantages over traditional mutual funds.

Read more at Yahoo Finance: The Fastest-Growing ETFs for Advisors