For many years, mutual funds were the primary means of investing. However, the chart above shows a significant shift toward Exchange-Traded Funds (ETFs), which is now accelerating.

According to a 2024 PwC survey, of more than 70 global ETF executives, 61% believe that US ETF assets under management (AuM) will reach at least $18 trillion by June 2029, growing at a compound annual growth rate of 14.9%. 

The visualization above shows the historical and projected growth of US ETF AuM, measured in billions of dollars.

TL;DR

• US ETFs reached $13.9 trillion in assets by January 2026. Industry experts expect this to grow to $18 trillion by 2029.
• Approximately 20% of managers remain highly optimistic, projecting that U.S. ETF assets will reach $21 trillion over the same period.
• This growth is largely due to a shift away from traditional mutual funds. In 2024, ETFs drew over $1.1 trillion in new investments, driven by lower costs, tax advantages, and easier access.

Country-Sized Portfolio

ETF managers expect the U.S. ETF market to reach $18 trillion in assets under management by June 2029. 

This growth represents a compound annual rate of 14.9% starting from $10.3 trillion in 2024.

If this target is met, the $18 trillion value would rival China’s nominal GDP. According to IMF data as of 2025, China’s GDP is approximately $19.4 trillion

A single US investment vehicle could hold wealth comparable to that of the world’s second-largest economy. This shift of assets demonstrates ETFs’ popularity, driven by their liquidity and diversification benefits.

Industry leaders attribute this growth to record investment inflows and innovations in active and thematic ETFs, including funds focusing on artificial intelligence.

The Bullish Minority

A notable 20% of surveyed managers are very optimistic, predicting that US ETF assets will exceed $21 trillion by 2029. This differs from the broader expectation of $18 trillion.

Reaching $21 trillion would require a compound annual growth rate exceeding 15%, which is higher than the current forecast of 14.9%. This suggests the market could double approximately every four years under favorable conditions.

This optimistic view is driven by increasing inflows into innovative products such as active and AI-themed ETFs. Many executives cite ongoing shifts in investor allocations from mutual funds as a key factor.

The projection highlights the growing importance of ETFs in wealth management and their potential to transform global investment strategies.

The Mutual Fund Exit

The increase in US ETF assets is mainly due to existing investors reallocating their wealth from traditional mutual funds to more efficient investment options.

In 2024, U.S. ETFs recorded $1.1 trillion in net inflows, significantly exceeding the $317 billion in net inflows to traditional mutual funds.

This difference underscores ETFs’ growing popularity, marking three consecutive years of dominance over mutual funds.

Investors are choosing ETFs over mutual funds because of their lower costs and better tax efficiency. This trend is expected to continue, especially as digital platforms and new products attract a broader range of investors.

The ongoing global transfer of wealth, estimated at more than $68 trillion, also supports this shift, with younger generations showing a stronger preference for ETFs.

ELI5

By January 2026, US ETFs, which are investment funds traded like stocks, had $13.9 trillion in assets under management. 

Experts think this will grow to $18 trillion by 2029, but only about 20% of managers are very optimistic, believing assets could reach $21 trillion in that time. 

Most of this growth is due to people favoring ETFs over traditional mutual funds. 

In 2024, ETFs attracted over $1.1 trillion in new money, mainly due to their lower costs, tax benefits, and easier access.

Sources: 

PwC Global, Worldometers, Insurance AUM