ETF Inflows Top $1 Trillion for First Time

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ETF Inflows Top $1 Trillion for First Time
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This year's inflows into ETFs world-wide crossed the $1 trillion mark for the first time at the end of November

are among the firms that have rolled out actively managed ETFs in 2021. Firms new to ETFs have also entered the fray.

Many active ETFs remain comparatively small and charge fees higher than passive funds, putting a swath of new products at risk of closing over the next several years. ETFs usually need between $50 million and $100 million in assets within five years of launching to become profitable, analysts and executives say; funds below those levels have tended to close.

“You’re going to see a lot of those firms take a hard look at their future,” said Elisabeth Kashner, FactSet’s director of ETF research. Vanguard has been a beneficiary of high inflows to funds that track indexes. A statue of founder John C. Bogle.ETF closures generally climbed over the past decade, and firms closed a record 277 ETFs last year as the coronavirus pulled markets down. Many held few assets. About a third of all active ETFs are marked as having a medium or high risk of closure, according to FactSet data that take into account assets, flows and fund closure history.

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