The Top Three ETF Trends for 2023

Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.

This year, 2023, will be important for the exchange traded fund (ETF) industry – it marks the 30th year since the first ETF was introduced to the U.S. market – and there is no reason to believe the rise in popularity of these assets among advisors will cease anytime soon. For instance, 2022 was a rocky year for performance across almost every sector of the market, and yet ETFs clocked their second-best year of inflows on record, raking in about $600 billion. While this paled in comparison to 2021 inflows, which reached approximately $900 billion by year end, this strong activity in ETFs bodes well for the continued health of these assets in the year to come.

Despite challenging economic headwinds, some industry experts anticipate that 2023 could be the year that ETFs cross the $1 trillion threshold for inflows. However, with so many different products available, advisors need to better understand some of the key emerging trends that will drive performance in the next year as they consider making changes to investment strategies and portfolios.