In Q3 2025, managed vehicles recorded net inflows of $827.4 billion, according to data from ISS MarketPulse powered by Simfund Total Market. This marked a solid increase over the second quarter, when funds raised $695.8 billion. ETFs were the strongest contributor to net deposits in the third quarter, followed by mutual funds, which saw net inflows exceeding $200 billion.
- Industry Overview by Asset Class and Vehicle
ETF net inflows in the third quarter totaled $529.5 billion, a significant increase over the second quarter’s $389.6 billion. Equity ETFs were the primary drivers of this growth, attracting $314.5 billion over the quarter. Passive ETFs captured the largest share of net flows at $384.2 billion. While active ETFs had assets under management of only $1.6 trillion, just one-tenth of the $16.7 trillion held by passive ETFs, active ETFs posted a respectable $145.3 billion in new deposits. ETFs based in the United States accounted for the largest portion of inflows, clocking in at $351.9 billion in inflows. Within passive ETFs, U.S. funds brought in $223.7 billion, a sizeable lead over the $73.5 billion for ETFs domiciled in Ireland, which serves as a hub for European funds. The dominance was even stronger in active ETFs, where U.S. funds attracted $128.2 billion, far ahead of Ireland’s $7.7 billion.
Mutual funds experienced the second highest quarterly inflows in Q3, reaching $284.8 billion, up from $230.9 billion in Q2. These gains were largely driven by money market funds, which have been the primary source of positive flows in recent quarters. Excluding money market funds, long-term mutual funds struggled, recording steep outflows of $37.5 billion after strong inflows of $41.9 billion in the previous quarter. Other pockets of demand emphasized conservative positioning as bond funds saw inflows rise to $207.1 billion from $171.6 billion in Q2. Equities, conversely, remained under pressure, suffering withdrawals of $229.1 billion, most of which came from active funds ($166.7 billion). U.S.-based equity funds saw the sharpest losses, with outflows totaling $193.2 billion for the quarter.
Collective investment trusts saw net commitments of $61.2 billion in Q3 2025, down from $102.3 billion in Q2. Allocation funds, primarily in the form of target-date funds, accounted for the bulk of inflows at $45.0 billion, though this was lower than the $58.1 billion recorded in the previous quarter. Money market funds contributed the second most for the quarter at $7.4 billion after facing outflows of $1.9 billion in Q2. All other asset classes also posted positive flows, but at levels well below those seen in Q2.
Retail separately managed accounts recorded $40.4 billion in inflows during Q3, a sharp rebound from $9.1 billion in Q2, though still below the $50.3 billion seen in Q1. Fixed income strategies led with $19.3 billion, up from $7.1 billion in the prior quarter. Equity products posted positive inflows of $11.2 billion after minor outflows of $14.0 million in Q2. Institutional separate accounts continued to face heavy redemptions, with net withdrawals surging to $88.6 billion, more than double Q2’s $36.1 billion. Within this segment, fixed income attracted $27.1 billion in inflows, but equity strategies suffered the most, with massive outflows totaling $113.7 billion.
Money market funds were the largest source of mutual inflows over the third quarter. Money market funds focusing on short-term U.S. securities gathered the most for mutual funds with inflows of $219.4 billion, a stark boost after Q2’s minor net deposits of $1.4 billion. The Asia Money Market category ranked second with $57.7 billion in net inflows, although this was a decline from the strong $138.3 billion recorded in the previous quarter. Additional inflows came from U.S.-based prime funds ($21.3 billion) and European money market funds ($13.5 billion).
Fixed income strategies delivered the second-highest mutual fund net deposits in Q3, totaling $207.1 billion, up from $171.6 billion in Q2. Activity was strongest in global markets, with Global Fixed Income recording the third highest net commitments for the quarter at $57.1 billion, a sharp turnaround from Q2’s redemptions of $2.4 billion, driven largely by Ireland-domiciled funds. Europe Fixed Income also recorded positive inflows of $46.6 billion. Among other fixed income categories, Intermediate Core Bond rebounded from $4.6 billion outflows in Q2 to positive flows of $32.6 billion in Q3. Another U.S.-focused intermediate-term strategy, Core-Plus Bond, recorded net deposits of $12.2 billion, up from $3.4 billion the prior quarter. Multisector Bond ($25.3 billion) and Emerging Market Fixed Income ($12.3 billion) strategies also improved significantly, having respectively witnessed inflows of $4.7 billion and outflows of $1.2 billion the prior quarter.
Equity ETFs remained the primary driver of inflows in Q3, attracting $314.5 billion, up sharply from $204.6 billion in Q2. Large-cap strategies led the surge, with Large Blend posting net deposits of $103.4 billion, well ahead of Global Equity Large Cap’s $65.9 billion. Within Large Blend, U.S.-domiciled funds dominated with $80.4 billion, followed by funds based in Ireland ($13.5 billion) and Canada ($4.9 billion). Global Equity Large Cap saw a slight uptick from Q2, with U.S.-based funds contributing $35.6 billion and Ireland-domiciled funds adding $21.2 billion. BlackRock led Large Blend inflows with $44.0 billion, closely followed by Vanguard at $36.8 billion. However, in Global Equity Large Cap, Vanguard took the lead with $23.1 billion, ahead of BlackRock’s $11.8 billion. Other large-cap segments also posted gains, including Large Growth ($26.2 billion) and Large Value ($16.7 billion). Beyond large-cap strategies, Technology ($22.9 billion) and Emerging Markets Equity ($17.3 billion) also attracted positive flows.
Non-traditional strategies also contributed positively. Commodities led the segment with net commitments of $30.2 billion, a notable jump from $17.8 billion in Q2. U.S.-domiciled funds accounted for $17.5 billion of these inflows. Fixed income ETFs delivered strong results as well, attracting $153.9 billion in Q3 compared to $123.9 billion in the prior quarter. Among fixed income strategies, Ultrashort Bond funds brought in the most at $20.2 billion, while Intermediate Core Bond funds added $15.7 billion. BlackRock led Ultrashort Bond inflows with $8.5 billion, while Vanguard topped Intermediate Core Bond with $9.6 billion.
Part two is coming soon, covering retail SMAs, CITs, and separate accounts.
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Authors:
Alan Hess, Vice President, U.S. Fund Research, ISS Market Intelligence
Antara Maity, Senior Associate, U.S. Fund Research, ISS Market Intelligence
Aishwarya Mahalingam, Associate, U.S. Fund Research, ISS Market Intelligence