Active ETF adoption among RIAs nears $400B, but weaker funds are getting squeezed out

Active exchange-traded funds have gone from a niche allocation to a central component of independent RIA portfolios over the past four years – and the numbers behind that shift are striking.

In the first quarter of 2021, independent RIAs collectively held roughly $27.7 billion in active ETFs. By the fourth quarter of 2025, that figure had climbed to approximately $396.5 billion, according to an analysis of FINTRX data tracking ETF usage across independent RIA portfolios.

The growth wasn't linear. The analysis found the most dramatic acceleration began in late 2022, coinciding with a broader industry push toward active ETF launches and mutual fund conversions. In 2024 alone, assets held in active ETFs within RIA portfolios climbed from roughly $182 billion to more than $355 billion.

The rise in dollar terms is matched by a shift in how advisors are using the product. In early 2021, the average RIA portfolio held roughly two active ETF tickers. By the fourth quarter of 2025, that number had climbed to 17 – more than an eightfold increase. Early use cases tended to cluster around income generation or tactical positioning; today, advisors are incorporating active ETFs across equity, fixed income, and multi-asset strategies.

The share of RIA portfolio assets allocated to active ETFs has also grown, rising from 3.24% in the first quarter of 2021 to 13.45% by the fourth quarter of 2025 – crossing the 10% threshold for the first time in 2024.

That broader adoption trend is showing up on the institutional side too. A white paper published this month by Cerulli Associates in partnership with Invesco found that more institutional asset allocators are considering active ETFs as products approach their three- and five-year track records. The report notes that active ETFs captured 31.2% of total ETF net flows during 2025, despite accounting for just 10.9% of total ETF assets.

Projections from Brown Brothers Harriman's 2026 Global ETF Investor Survey suggest the category could continue expanding at a rapid clip – modeling a base case in which active ETFs grow at roughly 20% annually to reach approximately $10 trillion by 2033, up from just under $2 trillion at year-end 2025.

Separate research by PwC pegged global active ETF assets at $1.7 trillion by the end of last year, with launches rising 72% from 2024. Looking ahead to 2030, 60% of respondents PwC surveyed anticipate assets in global active ETFs to at least double to $4 trillion by 2030.

Still, the FINTRX data indicates the market may be entering a more selective phase. After reaching a peak of 1,213 unique active ETF strategies in RIA portfolios in late 2024, the number stabilized around 1,180 to 1,200 throughout 2025. During that period, 59 active ETF tickers that appeared in RIA portfolios disappeared from the market entirely, indicating those funds were liquidated or closed.

The pattern points to an ecosystem that is maturing after years of rapid product proliferation. For ETF issuers, success in the RIA channel increasingly depends on clear portfolio positioning, strong differentiation, and precise targeting of advisors whose investment approach aligns with the strategy.

The Cerulli report flags a parallel dynamic among asset owners, noting that some public pension plans and endowments have seeded active ETFs directly with ETF managers – a sign that institutional demand for the wrapper is moving beyond passive index replication.