Goldman Sachs projects that the ETF market could surpass 6,000 listed funds by year-end, exceeding the number of individual U.S. stocks.

The surge reflects not just new launches but growing demand for existing products.

Consider the numbers: More than $1 trillion flowed into U.S.-listed ETFs in the first half of 2026. This puts the market on track to attract more than $2 trillion for the full year—a potential 40% increase from 2025.

The trajectory also makes way for structural change, including the rise of active management. More than 35% of ETF flows this year are going into active funds. Currently, active ETFs account for about 13% of the $16.1 trillion U.S.-listed ETF market.

Customization is another major driver. Assets in third-party model portfolios jumped 46% over the past year to $950 billion, highlighting the growing use of ETFs as building blocks for diversified, multi-asset portfolios.

AI Trade Splits Semis and Software

The ETF market is also providing a window into shifting investor preferences within the artificial intelligence trade.

Semiconductor ETFs attracted a record $19 billion-plus in June, while software ETFs suffered roughly $1.9 billion in outflows, one of their largest monthly redemptions since 2018.

That divergence suggests investors are increasingly using ETFs to express targeted views on specific parts of the AI ecosystem rather than simply buying broad technology exposure.

Trading activity is rising alongside flows. Goldman Sachs says ETF trading volumes are running 50% above 2025 levels, averaging roughly $320 billion in daily notional volume. During periods of market stress, ETFs can account for as much as 40% of overall trading activity.

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