European ETF inflows sharply lost momentum in March, but active ETFs emerged from the month in a stronger relative position. Morningstar data shows European ETFs and ETCs gathered €9.4bn in the month, down from an average of around €46bn in each of the first two months of the year, as investors turned more cautious amid geopolitical tension and market volatility. However, active ETFs still pulled in €2.4bn over the month. This was in line with the figures for January and February, but in March this equated to about a quarter of all ETF flows – versus low single digits for the first two months of the year.
The figures suggest that active ETFs are continuing to increase in relevance even when the overall market backdrop turns less supportive. And they are a continuation of a clear wider growth story: Europe’s active ETF market reached €78.4bn in assets by the end of 2025 after taking in €22.7bn of net new money during the year. This was a rough doubling in absolute size, but still only equated to 3.1% of the total European ETF market – implying significant room for further growth.
Our view
David Batchelor, senior analyst at QuotedData, said: “March’s numbers show that active ETFs are no longer just participating in the wider ETF market’s expansion, but are taking a steadily bigger share of investors’ attention – even when sentiment turns more defensive. In a weaker month for ETF demand overall, active flows proved resilient, reinforcing the sense that the segment is becoming a more established part of the market”.
