September ETF Flows Highlights
- Exchange-traded funds in the commodities-focused Morningstar Category drew in $10 billion, as gold prices skyrocketed.
- IShares pulled in a record $50 billion, led by IVV with $19 billion, while Dimensional set its own ETF record inflow with $5 billion on the heels of the Securities and Exchange Commission’s approval for its ETF share class proposal.
- US small-cap ETFs added over $4 billion, their best month since late 2024.
- Active ETFs’ $50 billion in inflows broke their previous record set in July 2025.
Investors piled $142 billion into US ETFs in September. That’s the best month so far this year and $53 billion more than last September’s tally. Active ETFs accounted for 35% of inflows, with the remaining going to passive ETFs. Year-to-date flows sit at $927 billion, with 2024’s record $1.109 trillion in its sights.
Some familiar Morningstar categories had the largest inflows and outflows. Large-blend ETFs gathered the most capital of any category, adding $31 billion last month. Leveraged-equity ETFs continued to bleed cash as investors pulled out about $7 billion, continuing a five-month streak of heavy outflows. They’ve lost $15 billion to outflows so far this year, which is more than they’ve lost in any full year.
Gold Rush: Skyrocketing Prices and Economic Uncertainty Drive Gold ETF Flows
It was a record month for flows into several gold ETFs, including iShares Gold Trust IAU and SPDR® Gold MiniShares GLDM. The commodities-focused Morningstar Category—which predominately houses gold funds—saw the third largest inflows of any category last month, bringing in $10 billion. Over $9 billion of those flows went to funds that directly hold the yellow metal, like SPDR® Gold Shares GLD, which captured the lion’s share of flows.
The price of gold has skyrocketed, more than doubling since November 2022, and it ended September at an all-time high. Investors have piled $38 billion into the commodities-focused category so far this year.
Two main factors have ignited the gold rush. Many global central banks have pivoted to gold from the US dollar, as the perceived safety of the US dollar has eroded with increasing national debt. For investors, gold is seen as a haven to weather economic storms, and there’s been plenty of uncertainty this year. But if speculative assets like gold swing too far, investors will pay the price if the pendulum swings back.
IShares’ ETFs Attract Record Inflows Amid Reshuffling of Model Portfolios
IShares and Dimensional Fund Advisors brought in more fresh capital in September than they had in any other month on record. IShares pulled in $50 billion into their ETFs last month, which is more than the net assets of most firms’ entire ETF lineup.
IShares Core S&P 500 ETF IVV pulled in nearly $19 billion, the most of any ETF in September. That was partly due to BlackRock increasing its allocation to IVV in several of its model portfolios. IShares S&P 100 ETF OEF also got a nice bump in flows from model reallocations and pulled in the second most inflows of any ETF last month. In fact, iShares’ ETFs accounted for four of the top five ETFs in inflows and three out of the four ETFs with the most outflows, due to their model adjustments.
SEC Allows Dimensional ETFs to Follow Vanguard’s Footsteps
Dimensional garnered over $5 billion of inflows, setting a new monthly record for the leading provider of active ETFs. September built the foundation for future flows, too, after the SEC gave notice it intends to allow Dimensional’s mutual funds to offer an exchange-traded fund share class. Vanguard has been doing so on several of its index-tracking funds since 2001, but its patent on the structure ran out in May 2023. Since then, over 75 asset managers have filed applications with the SEC to offer the hybrid structure, and Dimensional has been the first to break through.
Rate Cuts Boost Small-Cap ETFs
US small-cap stock ETFs had their best month since November 2024, pulling in over $4 billion. IShares Russell 2000 ETF IWM and Vanguard Small-Cap ETF VB were the two largest beneficiaries, bringing in a combined $3 billion in flows.
Borrowing costs have gone down a hair since the US Federal Reserve cut rates in September, and further cuts could continue to be a tailwind for small-caps that rely more heavily on outside financing. Inflation fears still loom large for small-caps, however, since they lack the pricing power of larger, more established competitors.
ETFs holding predominantly smaller stocks, like IWM, tended to outperform the large-cap market from the beginning of August 2025 through September 2025. VB didn’t perform as well due to its larger market-cap orientation, since the smaller end of the market-cap spectrum performed better over that period.
Active ETFs Continue to Gain Market Share
Active ETFs broke past their previous monthly record of $45 billion in July 2025, pulling in $50 billion in September. That pushed their year-to-date flows to $335 billion, higher than any previous full year. Active ETFs have accounted for 36% of ETF inflows in 2025 so far, and their share of flows has gradually increased since 2021, when it was only 9%.
The introduction of ETFs as a share class should push active ETFs’ market share even higher, since investors will likely soon be able to convert their mutual fund shares into ETFs (if offered by the fund provider) without having to trigger capital gains distributions or taxes.
Active bond ETFs accounted for over $16 billion of the inflows. Active bond funds tend to have more of an edge over their passive peers, compared with active stock funds. The bond market isn’t nearly as efficient as the stock market, and active managers can exploit those inefficiencies.