The report “2026 Global ETF Outlook: From Wrapper to Backbone” by State Street includes its now-traditional list of “clear and testable” predictions regarding the likely evolution of ETF markets in 2026. These forecasts highlight where momentum is building, where inflection points are emerging, and where change may arrive sooner—or later—than consensus expectations.
In total, the report presents 13 predictions for the North American ETF market:
1. U.S. ETFs Will Attract $2.1 Trillion in Net Inflows During the year, the ETF industry is expected to attract $2.1 trillion in inflows into U.S.-listed ETFs, surpassing the $1.49 trillion recorded at the end of 2025, according to ETF.com data cited by State Street. Global ETF inflows reached $1.9 trillion last year.
2. There Will Be More U.S. ETFs Than Mutual Funds The number of U.S. ETFs will exceed the number of mutual funds (excluding money market funds and fund-of-funds products), continuing an already established trend. The report notes that ETFs have become one of the dominant investment vehicles in North America due to their lower costs, tax efficiency, liquidity, and ease of use. They are also particularly popular among younger investors: ETFs represent 30% of Millennials’ portfolios on average. 26% for Generation X. 21% for Baby Boomers. Surveys indicate portfolio allocations to ETFs could rise by 20% or more across all age groups, including a 31% increase among Generation X investors.
3. The Top 10 ETF Issuers Will Change Rankings The top 10 U.S. ETF issuers as of January 1 will not remain in the same order by December 31.
4. Multiple ETF Industry Acquisitions Will Take Place The report expects continued consolidation through acquisitions within the ETF industry.
5. The First $1 Trillion ETF Will Emerge The market is expected to see the launch or growth of the first ETF to surpass $1 trillion in assets.
6. Active ETFs Will Attract $750 Billion in Inflows Active ETFs in the United States are projected to attract $750 billion in net inflows, representing a 50% increase over year-end 2025 levels. Last year, 34% of ETF inflows were directed toward active products.
7. Active ETFs Will Account for 85% of New Launches Approximately 85% of ETF launches will be actively managed funds, roughly in line with last year’s figure of 84%.
8. Active Fixed-Income ETFs Will Outpace Passive Fixed-Income ETFs Inflows into active fixed-income ETFs are expected to exceed those of passive fixed-income ETFs. The report argues that ETFs are particularly well suited to fixed-income investing. Bond market characteristics and investor preferences naturally favor active management, which offers flexibility to adjust duration, credit quality, and sector exposure. “The ETF structure, which allows for daily in-kind, custom basket, or cash transactions, enables managers to operate efficiently in an investment universe where individual bonds have limited lifespans and liquidity, while trading and price discovery are not continuous,” the report explains.
9. Inflows Into Global and Emerging-Market Equities Will Double U.S. investment flows into global and emerging-market equity ETFs will double compared with 2025 levels.
10. At Least 12 Firms Will Add ETF Share Classes At least 12 firms will add an ETF share class to a mutual fund or a mutual fund share class to an ETF. The SEC approved ETF share classes in November of last year.
11. One Hundred Mutual Funds Will Convert to ETFs The report forecasts 100 mutual fund-to-ETF conversions during the year.
12. Canada Will Nearly Double ETF Subscriptions Canadian ETF subscriptions are expected to nearly double, rising from $109 billion in 2025 to more than $200 billion in 2026.
13. Active ETFs in Canada Will Surpass $200 Billion Assets in Canadian active ETFs are expected to exceed $200 billion during the first half of the year.
