Mutual funds are 100 years old, but remain in favor for young Americans

Mutual funds are 100 years old, but remain in favor for young Americans
New fact book focuses on state of the investment fund industry.
MAY 16, 2024

It was March 2024 when the Massachusetts Investors Trust was launched in the U.S. as the first modern mutual fund, but what does the industry look like 100 years on?

As well as that initial fund still being in existence, managed by MFS Investment Management, mutual fund assets held by U.S. investment companies remain strong at $25.5 trillion at the end of 2023. U.S. registered firms also had $8.1 trillion in ETF assets, $249 billion in traditional closed-end funds, and $77 billion in unit investment trusts.

The newly published Investment Company Fact Book from the Investment Company Institute reveals the state of the investment fund industry, bringing together the ICI’s research and analysis from the past year.

“Mutual funds have played a pivotal role in democratizing investing, making it possible for 116 million Americans to participate in financial markets and achieve their financial goals. The growth and evolution of mutual funds over the past century is a testament to their enduring appeal and the trust investors place in them,” said ICI’s chief economist Sean Collins.

Among the key facts are that Gen Z and Millennial households continue to invest in mutual funds with 48% and 35% of the two cohorts, respectively, owning mutual funds. Overall, 71% of U.S. households and more than 120 million individuals own U.S. registered funds with the median mutual fund assets of those households totaling $125,000.  

The stats also show that around one third of American household’s financial assets are earmarked for retirement. Individual account-based retirement savings were 63% of total U.S. retirement market assets, and mutual funds managed about half of those account-based retirement assets.

“ICI’s latest edition of the Investment Company Fact Book presents a wealth of statistical data detailing the current state of the asset management industry as we celebrate the 100th anniversary of the mutual fund and the 50th anniversary of the individual retirement account,” said ICI president and CEO Eric J. Pan. “These milestones are a testament to the hardworking people immersed in serving American investors through the asset management industry.”

Globally, regulated long-term open-end funds had net sales of $781 billion in 2023 compared with net redemptions of $156 billion in 2022.

Latest News

Citarell to spearhead Northeast sales growth for Easterly
Citarell to spearhead Northeast sales growth for Easterly

John Hancock veteran has more than 30 years of industry experience.

Hightower Advisors chief Oros to step down, Goldman Sachs 'lifer' is replacement
Hightower Advisors chief Oros to step down, Goldman Sachs 'lifer' is replacement

New leader takes over a firm that has seen remarkable transformation.

Why aren't investors celebrating stellar US earnings season?
Why aren't investors celebrating stellar US earnings season?

Tariffs, rates are overshadowing what should be a positive period.

Gold declines for second day following comments from Fed’s Powell
Gold declines for second day following comments from Fed’s Powell

Record rally for bullion is on hold for now as investors weigh outlook.

BlackRock hopes to end dispute with FDIC over bank stakes
BlackRock hopes to end dispute with FDIC over bank stakes

The deadline for an agreement has already been extended twice.

SPONSORED Taylor Matthews on what's behind Farther's rapid growth

From 'no clients' to reshaping wealth management, Farther blends tech and trust to deliver family-office experience at scale.

SPONSORED Why wealth advisors should care about the future of federal tax policy

Blue Vault features expert strategies to harness for maximum client advantage.