Over the past two years, the scale has nearly doubled—US ETFs are “burning hot”

Author: Zhang Yaqi; Source: Wall Street Insights

The U.S. ETF industry is witnessing an unprecedented expansion that is accelerating. In 2026, three core metrics—assets under management, capital inflows, and trading volume—are setting new historical highs or are coming close to them in sync, as the industry ecosystem has fully entered a phase of high-speed operation.

According to Goldman Sachs’ latest assessment by Chris Lucas, head of the firm’s ETF business, U.S.-listed ETF net inflows have already surpassed $1 trillion since the beginning of the year. For the full year, net issuance is expected to exceed $2 trillion, which would break the 2025 historical record by more than 33%. Meanwhile, in the first half of the year, total ETF trading volume surpassed $4 trillion, up 50% versus the same period in 2025.

Behind the continued influx of capital, U.S. large-cap technology stocks, semiconductors/AI, emerging markets and Korea thematic products, as well as actively managed ETFs, are the main drivers of this round of growth. Actively managed ETFs have already attracted about $400 billion in assets in the year to date, accounting for roughly 40% of total industry inflows—about three times their market share in assets under management.

Assets approaching $1.6 trillion, nearly doubling in two years

Total assets of U.S.-listed ETFs have exceeded $1.56 trillion, with the industry’s size nearly doubling over the past two years. Goldman Sachs believes that with current momentum, moving up to the $1.7 trillion mark by year-end is “within reach.”

This growth pace is without precedent in the industry’s history. The rapid expansion in scale is driven jointly by net inflows and rising asset prices. The two reinforce each other through a positive feedback loop, pushing the industry to keep breaking upward.

So far this year, ETF industry net inflows are not only large in magnitude, but also highly sustained. In June, net inflows reached $193 billion for the month, the second-highest monthly inflow in Goldman’s dataset.

Even more noteworthy is that monthly performance at levels near record highs has become the norm. According to Goldman’s statistics, over the past seven months, the ETF industry experienced five of the largest months by monthly inflow in its history, in a rare pattern of concentration.

From the perspective of fund flows, actively managed ETFs stand out especially. Actively managed ETFs have received roughly $400 billion in inflows this year, accounting for nearly 40% of total industry inflows, while their assets under management account for only about 13% of the overall total. The rise of concentrated thematic ETFs is seen as an important new trend for 2026, continuing the logic that the 2024 spot crypto ETF opened up a new channel for market access.

Trading volume surges 50%, leveraged ETFs are the biggest variable

In the first half of the year, the ETF ecosystem’s trading volume has been “running at full speed.” Average daily trading volume reached $325 billion, and cumulative trading volume in June totaled $7 trillion for the month—also ranking second-highest in history.

Leveraged ETFs are the core catalyst behind this round’s surge in trading volume. In June, the nominal trading volume of leveraged ETFs set a monthly record at $1.1 trillion, with the increase versus the same period in 2025 also exceeding 50%. If you translate the leverage effect into actual exposure, using a 3x leveraged product as an example, the total exposure generated by leveraged ETFs in June was close to $3 trillion, equivalent to about 40% of the nominal trading volume of all U.S.-listed ETFs in that month.

Currently, assets under management for leveraged ETFs are about $175 billion, but their actual total exposure already exceeds $430 billion. The multiple relationship between the two highlights how this category of products amplifies liquidity in the overall market.

In global equity markets, the acceleration in trading volume is also significant. The total trading volume of mining ETFs has already exceeded the entire 2025 full-year total. In addition, the two largest ETFs in emerging markets—EEM and IEMG—have trading volumes that are close to matching last year’s full-year level.

ETF count surpasses domestic listed companies, new product issuance accelerates

The number of U.S.-listed ETFs has reached about 5,400, while the number of domestic listed companies is about 4,000. The “outnumbering” of stocks by ETFs continues to expand. As of this year to date, more than 770 new ETFs have launched, with 54% using derivative instruments and 33% classified as leveraged or inverse products.

Goldman Sachs expects that the rapid expansion of derivative applications and concentrated thematic products will be the core trend in the second half of the year. As a large batch of products awaiting approval gradually come into effect, the pace of new product issuance is expected to remain high.

DRAM surpasses EWY, storage-themed ETF landscape reshaped

The capital-migration effect brought by the rise of concentrated thematic ETFs is exemplified in the storage-chip theme. The DRAM thematic ETF focused on DRAM storage chips, DRAM, has officially surpassed the Korea ETF EWY, which has a 26-year history, in total asset size.

Although EWY’s fund net value has risen nearly 50% since April this year, it recorded net capital outflows of about $2 billion over the same period. Goldman Sachs noted that the overlap between EWY and DRAM holdings is about 46%, meaning that to a certain extent, EWY had been an alternative tool for investors to implement their allocation to the international storage theme. When more precise thematic channels emerge, the shift of capital happens quickly and clearly, clearly demonstrating how fast the industry landscape can change after new market-access tools are introduced.