Surge in ETF cash inflows drives US stock market to record highs

From Nasdaq: 2024-12-06 15:16:00

In 2024, US-listed ETFs have seen over $1 trillion in flows, driven by the “Trump trade” boosting stock prices to record highs. ETFs are preferred for their tax efficiency and low costs, causing mutual funds to lose assets at an unprecedented rate.

Low-cost ETFs tracking major indexes like the S&P 500 and Nasdaq-100 have attracted $215 billion in new investments this year. US ETF assets surpassed $10 trillion in September, with the S&P 500 up over 27% and the Nasdaq-100 up 30%.

Investors are favoring US stock ETFs over non-US counterparts, with 97% of equity inflows going into US equity ETFs in November, according to State Street. The launch of Bitcoin ETFs, like the iShares Bitcoin Trust with over $50 billion in assets, has been a major success.

ETF providers are innovating with actively managed and derivative-based ETFs, including single-stock ETFs for popular companies like NVIDIA, Tesla, and MicroStrategy. The industry’s growth in 2024 is driven by market performance, investor demand, product innovation, and cost-effective investment options.



Read more at Nasdaq: Record ETF Cash Inflows Power Market Surge