Citigroup has significantly raised its projections for the growth of U.S. exchange-traded funds (ETFs), stating that assets under management (AUM) could more than double to $25 trillion by 2030 as investors increasingly favor ETFs for their low-cost, diversified market exposure [1]. As of March 2025, the total AUM for U.S.-listed ETFs stood at approximately $10.4 trillion, according to Citi [1]. Previously, Citigroup forecasted the industry's AUM to reach $19 trillion by 2030 and $29 trillion by 2035, but now expects more than $40 trillion by 2035, reflecting a more optimistic outlook [1].
Citigroup attributes a substantial portion of this anticipated growth to active ETFs, which are expected to outpace passive ETFs in attracting investments. The brokerage notes that active ETFs are among the fastest-growing segments, offering flexible strategies and lower costs, with many aiming to outperform benchmarks or deliver specific investment outcomes [1]. Citi's base case expects the market share of active ETF AUM to double over the next ten years as these products capture a greater share of industry flows [1].
Additional factors driving ETF industry expansion include product innovation, streamlined ETF launch regulations, adoption of more sophisticated strategies, and increased demand for flexible, tax-efficient investment solutions [1]. According to LSEG Lipper data, ETFs tracking U.S. equities have seen over $75.8 billion in inflows so far this year, building on more than $1.1 trillion in inflows over the past two years [1]. Furthermore, U.S.-domiciled ETFs have recorded more than $435 billion in inflows so far this year [1].
Citigroup also notes that while these projections are more optimistic than previous estimates, they suggest the ETF industry will enter a more mature phase of AUM growth, with organic flows and performance drivers becoming more balanced compared to the past decade [1].
CONCLUSION
Citigroup's revised projections signal robust growth for the U.S. ETF industry, with assets expected to more than double by 2030, driven largely by active ETFs and strong investor inflows. The market is poised to enter a more mature phase, supported by innovation and regulatory ease. This outlook indicates high market impact and positive sentiment for ETF providers and investors.