US Fund Flows: ETFs and Taxable Bond Funds Set Records in 2025

Long-term US funds brought in $765 billion in 2025, with assets growing 2.5% relative to year-end 2024. On an absolute basis, the annual inflow was the second-largest in the past decade, trailing only 2021. 

Once again, taxable-bond funds dominated the year’s inflows. These funds brought in a record $540 billion, much of which was concentrated in the more conservative Morningstar Categories. And while investors exited US equity funds, international-equity funds saw their largest annual inflow since 2021.

The charts below illustrate which direction the money is flowing for a variety of fund types. For a more complete analysis, download the full monthly report.

Passive funds have continued to gain market share of the US funds universe. As of year-end 2025, passively managed funds made up over 55% of net assets. 

Actively managed US equity funds have been hit particularly hard, as they now make up less than 35% of the category group. For the first time, active international-equity funds make up less than half of the category group’s assets, with passives holding a 52% market share of the category group. 

Actively managed fixed-income funds still hold the majority of assets, but they too have ceded ground.

For a second straight year, investors placed record amounts in exchange-traded funds, preferring their lower costs and increased transparency. iInvestors added nearly $1.5 trillion to those vehicles in 2025. 

While open-end funds still hold more assets than ETFs, that may not endure for much longer. Today, ETFs represent about 38% of the market. Their net assets increased over $3 trillion in 2025, rising above $13 trillion in total, while open-end fund net assets grew by less than $2 trillion. 

At this pace, ETFs could overtake open-end funds in total assets by 2030.

Taxable-bond funds saw their largest annual inflows in history, with $540 billion in flows. The group made up 70% of total long-term US fund inflows in 2025. 

The only outflow came in April—each subsequent month saw at least $50 billion of inflows. 

While passively managed taxable-bond funds took in over 55% of the year’s inflows, actively managed funds still had a strong year. Only two of 27 taxable-bond Morningstar Categories experienced outflows in 2025. More conservative categories, like ultrashort bond and intermediate core bond, represented a large portion of inflows.

International-equity funds enjoyed their eighth consecutive monthly inflow in December, helping push the 2025 net flow past $57 billion. 

Performance likely contributed to the move abroad, as the Morningstar Global Markets ex-US NR Index posted a 31.6% increase in the year. 

The 2025 inflow was the first sustained influx of cash since 2021. Passive inflows of about $160 billion overcame active outflows of about $100 billion.

Despite back-to-back months of outflows to end the year, digital-assets funds continued to see significant inflows in 2025. Their $42 billion intake barely trailed the record set in 2024. Still, 2025’s third quarter included a record quarterly inflow of $22 billion. 

Flows into the digital-assets category have carried the flows of the broader alternatives category group since the SEC approved spot bitcoin ETFs in January 2024. There's been a clear correlation between the price of major cryptocurrencies, like bitcoin and ethereum, and the magnitude of flows into the category.

For more comprehensive analysis and commentary on US Fund Flows, download this month’s full report.

• Active vs. passive fund flows breakdown.
• Morningstar categories with the lowest and highest fund flows
• Government bond fund and money market flows

Morningstar’s asset fund flows history dates to 2008, with forecasting models for future growth rates. The Morningstar Direct application includes all fund flows data along with its performance reporting, presentation, and search capabilities. 

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