- Europe-domiciled ETFs attracted $29.5 billion of assets in January, continuing the trend of strong inflows from 2024.
- Equity ETFs dominated the net inflows, garnering $24.7 billion in new assets, while fixed income exposures had $4.5 billion of inflows.
- The Vanguard UCITS ETF range captured net inflows of $3.6 billion in January, with the majority of ETFs in the range recording positive flows.
Monthly recap: Strong January flows show continuation of trends from record-breaking 2024
Europe-domiciled ETFs continued the flow trends we saw in the final quarter of 2024 – namely strong net inflows skewed heavily towards core equity exposures. Of the $29.5 billion total net inflows in January, equity ETFs captured $24.7 billion, with investors favouring US and developed market exposures. The positive flows came amid rising equity markets in January, particularly in the US and Europe, and while we saw a sharp bout of volatility relating to AI companies and tech more broadly near the end of the month, it was short-lived.
We also saw a broadly supportive market backdrop in fixed income markets, with both global aggregate and US aggregate indices rising in January1. Bond ETF investors picked up where they left off last year, adding $2.5 billion to ultra-short maturity ETFs last month, while government bond ETFs also saw healthy net inflows of $2.0 billion. In total, fixed income ETFs saw $4.5 billion of net inflows in January. In considering the outlook for bonds, we believe higher income creates a more positive risk-reward trade-off for investors in 2025 and beyond.
Multi-asset, alternative and commodity ETFs all had net inflows in January.
Total ETF market flows
ETFs post strong inflows to start the year
European ETF cumulative flows – cumulative 12 months by asset class ($ billion)
Source: ETFbook, as at 31 January 2025.
Equity ETFs
Core equity ETF flows dominate again in January
Equity flows by category: Month to date ($ million)
Source: ETFbook, as at 31 January 2025. The ‘segment’ category includes equity exposures which target specific market capitalisation segments, such as small-cap, mid-cap and large-cap. The ‘market access’ category includes difficult-to-access markets such as emerging markets. The ‘basket’ category includes strategies that combine several stocks as the underlying exposure, such as FAANG stocks.
Core equity ETFs started the year with $14.8 billion of net inflows in January, continuing the positive flow trend we saw throughought 2024. Smart beta and sustainable ETFs also had net inflows in January, garnering $2.9 billion and $2.3 billion of new assets, respectively. We saw no meaningful net outflows in January among the categories we track.
Investors continue to favour US and developed market equity ETFs
Equity flows by geographic exposure: Month to date ($ million)
Source: ETFbook, as at 31 January 2025. The ‘world’ category excludes emerging markets.
US equity ETFs saw the highest monthly inflows in January, hauling in $10.5 billion. Developed market ETFs came in second, capturing $6.4 billion of net inflows while global exposures brought in $3.1 billion. Emerging market and UK equity ETFs, on the other hand, weathered net outflows of -$509 million and -$444 million, respectively.
Fixed income ETFs
Ultra-short maturity ETFs see further inflows in January
Fixed income flows by category: Month to date ($ million)
Source: ETFbook, as at 31 January 2025.
Continuing the trend of positive flows we saw in 2024, ultra-short maturity bond ETFs were the most popular with European investors in January, as they attracted $2.5 billion in assets. Government bond ETFs followed closely behind, with net inflows of $2.1 billion. Conversely, aggregate bond ETFs saw outflows of -$303 million during the month.
Euro area and US bond ETFs capture highest net inflows
Fixed income flows by geographic exposure: Month to date ($ million)
Source: ETFbook, as at 31 January 2025.
Euro area bond ETFs easily topped the table in January, collecting $2.8 billion in net inflows. US bond exposures also saw demand, garnering $947 million of net inflows. At the other end of the spectrum, emerging market bond ETFs endured net outflows of -$359 million.
Vanguard UCITS ETFs
Vanguard range sees net inflows of $3.6 billion in January
Vanguard UCITS ETF net flows: Month to date ($ million)
Source: ETFbook, as at 31 January 2025.
The Vanguard UCITS ETF range captured net inflows of $3.6 billion in January, with the majority of ETFs in the range recording positive flows. Inflows were split between Vanguard’s equity UCITS ETF range ($2.9 billion) and fixed income UCITS ETF range ($634 million), while the multi-asset UCITS ETF range saw net inflows of $71 million.
1 Referenced indices are the Bloomberg Global Aggregate Index and the Bloomberg US Aggregate Index.
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