Institutional Investors Are Rapidly Expanding Usage of ETFs
Rhea-AI Summary
Invesco (NYSE: IVZ) and Cerulli publish research showing North American institutional ETF adoption nearly doubled over five years, with institutional ETF assets reaching ~$337B in 2025 and a 14.4% CAGR (2020–2025). Nearly half of current institutional ETF users plan higher allocations in the next 24 months; 16% of non‑users expect to start using ETFs.
The study highlights ETFs being used as core and tactical holdings, growing interest in active fixed‑income ETFs, esoteric exposures, and issuer‑partnered product launches.
Positive
- Institutional ETF assets approximately $337B in 2025
- ETF holdings 14.4% CAGR from 2020 to 2025
- Nearly 50% of users expect to increase ETF allocations within 24 months
- 16% of non‑users plan to begin using ETFs within 24 months
Negative
- None.
News Market Reaction – IVZ
In the Apr 21 session, IVZ gained 0.08%, reflecting a mild positive market reaction.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Historical Context
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| Apr 13 | Strategic partnership | Positive | +3.0% | Expanded Superstate partnership and new operational collaboration on tokenized fund. |
| Apr 10 | AUM update | Neutral | +0.0% | Reported Mar 31, 2026 AUM of $2,159.5B with modest long‑term inflows. |
| Apr 01 | Earnings timing | Neutral | +0.1% | Announced date and logistics for Q1 2026 earnings release and call. |
| Mar 24 | Tokenization deal | Positive | +0.9% | Invesco to manage Superstate’s tokenized short‑duration U.S. Treasuries fund USTB. |
| Mar 18 | ETF product launch | Positive | -1.3% | Launch of Invesco QQQ Equal Weight ETF expanding the QQQ Innovation Suite. |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
IVZ has generally reacted positively to product launches and partnership/tokenization news, with only one recent divergence on an ETF launch headline.
Over the last six weeks, IVZ has highlighted several growth and innovation themes. On Mar 18, it launched the Invesco QQQ Equal Weight ETF, followed by tokenization partnerships around the USTB fund on Mar 24 and an expanded Superstate partnership on Apr 13. AUM updates on Mar 10 and Apr 10 via 8‑Ks and press releases have kept investors focused on flows and market moves. Today’s ETF‑adoption research further underscores IVZ’s positioning in ETFs and institutional solutions.
Key Terms
exchange-traded fund (ETF) financial
assets under management (AUM) financial
compound annual growth rate (CAGR) technical
index tracking ETFs financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
New Cerulli research, in collaboration with Invesco, shows North American asset owners' adoption of ETFs has doubled in five years, as investors seek liquidity, efficiency, and access to previously hard to reach strategies
The research found that institutional asset owners – including public and corporate defined benefit plans, endowments, foundations, insurance general accounts, and health and hospital systems – have nearly doubled their ETF usage over the past five years, with assets reaching approximately
Institutional asset owners are now allocating to ETFs as both a core portfolio holding and in an operational or tactical manner. According to the study, institutions expect to continue expanding ETF use across both strategic and operational applications. Nearly half of institutional ETF users expect to increase their ETF allocations over the next 24 months, while
- Improved liquidity
- Operational efficiency
- An expanded menu of ETFs across asset classes
- Longer performance track records
- Ability to deploy capital quickly in one diverse product
- Lower fees
- Asset owners partnering with ETF issuers to bring new, innovative products to market
"As asset managers remain dedicated to developing new ETFs – most notably actively managed strategies and esoteric index exposures – it is important for asset owners to keep a pulse on the pace of innovation and how those new products can be used within portfolios." says Brendan Powers, Director of Product Development Research at Cerulli. "We believe the use cases for ETFs institutional adoption will continue to grow especially for investment teams seeking to increase team capacity, address liquidity concerns, access unique investment strategies, and co-manufacture desired exposures," he concludes.
Index tracking ETFs remain an important foundational vehicle, with most institutional asset owners allocating to index equity products such as market-cap weighted or equal-weighted core equity ETFs. While demand for these strategies remains strong, Cerulli research finds that more institutional asset allocators are broadening their ETF usage and are considering active ETFs – especially within active fixed-income – as products approach their three- and five-year track records. As institutional adoption of ETFs continues, the whitepaper highlights several other areas beyond active ETF usage that are poised to expand. ETFs that access unique areas of the market, such as cryptocurrency, bank loans, or emerging markets, offer an efficient way for institutions to gain exposure. The research also explores case studies where asset owners have partnered with an asset manager to develop and seed new ETFs.
"Our research clearly shows that institutional investors are no longer experimenting with ETFs, they are utilizing them to build core positions and make strategic adjustments to their portfolios," said Garrett Glawe, Head of Asset Owner & Consultant ETF Specialists at Invesco. "Our asset owner clients are using ETFs to gain turnkey exposure to different asset classes and geographies, address concentration concerns in the US equity market, and build public proxies for private markets."
Inside Institutional ETF Adoption – How asset owners are broadening use cases is the only research of its kind focused exclusively on the
About Invesco Ltd.
Invesco Ltd. is one of the world's leading asset management firms serving clients in more than 120 countries. With
Invesco Distributors, Inc. is the
About Cerulli Associates
For over 30 years, Cerulli has provided global asset and wealth management firms with unmatched, actionable insights. Headquartered in
About Risks
There are risks involved with investing in ETFs, including possible loss of money. Index-based ETFs are not actively managed. Actively managed ETFs do not necessarily seek to replicate the performance of a specified index. Both index-based and actively managed ETFs are subject to risks similar to stocks, including those related to short selling and margin maintenance. Ordinary brokerage commissions apply. The Fund's return may not match the return of the Index. The Fund is subject to certain other risks. Please see the current prospectus for more information regarding the risk associated with an investment in the Fund.
Investments in financial institutions may be subject to certain risks, including the risk of regulatory actions, changes in interest rates and concentration of loan portfolios in an industry or sector.
Before investing, investors should carefully read the prospectus/summary prospectus and carefully consider the investment objectives, risks, charges and expenses. For this and more complete information about the Fund call 800-983-0903 or visit invesco.com for the prospectus/summary prospectus
Not a Deposit; Not FDIC Insured; Not Guaranteed by the Bank; May Lose Value; Not Insured by any Federal Government Agency.
Invesco Distributors, Inc. 04/26 NA 5239989
NOT A DEPOSIT l NOT FDIC INSURED l NOT GUARANTEED BY THE BANK | MAY LOSE VALUE | NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY
Contact: Samantha Brandifino, Samantha.brandifino@invesco.com, 332.323.5557 | Devon Schiller, dschiller@cerulli.com, 617.841.1062
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SOURCE Invesco Ltd.