A Look at October's ETF Boom: What's Driving the Surge?

Massive Surge in Investments

October witnessed a historic influx of capital into US exchange-traded funds (ETFs), with a record-breaking $166 billion in net new assets. The surge was spearheaded by Vanguard, which recorded its best month ever, attracting over $50 billion.

Key Highlights

• US Stock ETFs Dominate: The largest share of inflows went into US stock ETFs, with large-blend ETFs capturing the most attention.
• Vanguard's Stellar Performance:
• VOO (Vanguard S&P 500 ETF) was a standout, drawing nearly half of the flows into large-blend ETFs.
• VOO has been the most popular ETF of 2025, with $103 billion in flows year-to-date.
• VTI (Vanguard Total Stock Market ETF) also contributed significantly to Vanguard's success.

Sector-Specific Trends

• Technology ETFs: Despite the US stock market being more concentrated than in decades, investors continued to pour money into technology-sector ETFs, with a record $8 billion in new assets. These ETFs primarily invest in tech giants like Nvidia, Microsoft, and Apple.
• Overlap Concerns: The top holdings in tech ETFs are similar to those in broader market ETFs, leading to potential investment overlap.

Notable Performers

• SPYM (State Street's SPDR Portfolio S&P 500 ETF):
• After a name and ticker change, it broke its monthly flow record.
• Offers advantages over its sibling ETF, SPY, including lower fees and the ability to reinvest dividends and lend securities.
• Cryptocurrency ETFs:
• Despite the declining price of bitcoin, investors continued to pour money into cryptocurrency ETFs.
• The largest spot bitcoin ETF, IBIT, saw $4 billion in inflows in October.
• Gold ETFs:
• GLD (State Street's SPDR Gold Shares) made the top 10 list for ETF inflows in October.

Outflows and Market Performance

• Trading-Leveraged Equity ETFs:
• Saw the most outflows of any category, despite the number of trading-tool ETFs more than doubling over the first three quarters of 2025.
• Market Performance:
• Large-cap US stocks outperformed their mid- and small-cap peers.
• Emerging-market stocks had a solid month, outperforming overseas developed markets.