While passive funds finally overtook active management in 2023, a closer look at the year's staggering $32 trillion U.S. fund industry reveals a complex story of shifting assets, surging ETFs, and resilient investor trends that defined the market.
Key Takeaways
- In 2023, U.S. mutual fund total net assets reached $18.9 trillion, a 5.1% increase from 2022.
- Equity mutual funds in the U.S. held $13.1 trillion in assets as of year-end 2023, representing 69% of total mutual fund assets.
- U.S. bond mutual funds accounted for $5.2 trillion in assets at the end of 2023, down 2% from the previous year.
- Global ETF assets under management hit $11.5 trillion by end of 2023.
- U.S. ETFs held $8.3 trillion in AUM as of December 2023, up 12% YoY.
- The number of U.S.-listed ETFs reached 2,600 in 2023.
- Global hedge fund AUM reached $4.3 trillion in 2023.
- U.S. hedge funds managed $2.1 trillion AUM end of 2023.
- Hedge fund industry net inflows were $120 billion in 2023.
- Global private equity AUM reached $4.5 trillion in 2023.
- Dry powder in private equity hit $2.6 trillion end 2023.
- Private equity buyout deal value was $650 billion in 2023.
- Global fund industry AUM totaled $120 trillion in 2023.
- Passive funds overtook active funds with 48% market share in 2023.
- Fund industry net flows were $2.5 trillion globally in 2023.
The U.S. fund industry grew significantly in 2023, driven by strong equity inflows and lower costs.
ETFs
1Global ETF assets under management hit $11.5 trillion by end of 2023.
Verified2U.S. ETFs held $8.3 trillion in AUM as of December 2023, up 12% YoY.
Verified3The number of U.S.-listed ETFs reached 2,600 in 2023.
Verified4Equity ETFs accounted for 72% of U.S. ETF AUM in 2023.
Directional5Fixed income ETFs grew to $1.7 trillion AUM in U.S. by end 2023.
Single source6U.S. ETF net inflows totaled $785 billion in 2023.
Verified7Actively managed ETFs reached $400 billion AUM in 2023, up 40%.
Verified8The SPDR S&P 500 ETF (SPY) had $500 billion AUM in 2023.
Verified9Commodity ETFs held $120 billion in U.S. in 2023.
Directional10Average U.S. ETF expense ratio fell to 0.37% in 2023.
Single source11Multi-asset ETFs grew 25% in AUM to $250 billion in 2023.
Verified12U.S. equity ETFs saw $550 billion inflows in 2023.
Verified13Smart beta ETFs managed $1.2 trillion globally in 2023.
Verified1445% of U.S. ETF assets were in broad market equity ETFs in 2023.
Directional15Bond ETFs had average 1-year return of 6.2% in 2023.
Single source16The number of active ETFs launched in U.S. was 150 in 2023.
Verified17ESG ETFs reached $300 billion AUM in U.S. end 2023.
Verified18U.S. ETF trading volume averaged 3.5 billion shares daily in 2023.
Verified19Leveraged and inverse ETFs totaled $90 billion AUM in 2023.
Directional20International equity ETFs held $1.1 trillion in U.S. 2023.
Single source21U.S. ETF industry share of total fund assets was 42% in 2023.
Verified22Crypto ETFs launched with $10 billion inflows in late 2023.
Verified23Average daily AUM for U.S. ETFs was $7.8 trillion in 2023.
Verified24Fixed income ETF inflows hit $250 billion in 2023.
Directional2565% of U.S. advisors recommended ETFs over mutual funds in 2023.
Single sourceETFs Interpretation
Investors have placed an enormous, $11.5 trillion global bet on the ETF wrapper, effectively turning a once-simple indexing tool into a sprawling, cost-competitive, and increasingly clever financial ecosystem that now commands nearly half of all U.S. fund assets.
Hedge Funds
1Global hedge fund AUM reached $4.3 trillion in 2023.
Verified2U.S. hedge funds managed $2.1 trillion AUM end of 2023.
Verified3Hedge fund industry net inflows were $120 billion in 2023.
Verified4Equity long/short strategies held 28% of hedge fund AUM in 2023.
Directional5Global macro hedge funds returned 8.5% average in 2023.
Single source6Number of hedge funds worldwide was 11,200 in 2023.
Verified7Credit strategies in hedge funds grew 15% AUM to $450 billion in 2023.
Verified8Multi-strategy hedge funds AUM hit $600 billion in 2023.
Verified9Hedge fund average management fee was 1.4% in 2023.
Directional10Event-driven hedge funds returned 10.2% in 2023.
Single source1142% of hedge fund assets were managed by top 50 firms in 2023.
Verified12Relative value arbitrage strategies AUM was $350 billion in 2023.
Verified13Hedge funds outperformed public markets by 2.1% in 2023.
Verified14Emerging markets hedge funds grew 12% in AUM to $200 billion.
Directional15Average hedge fund incentive fee was 16.5% in 2023.
Single source16CTA/managed futures hedge funds returned 7.8% in 2023.
Verified17Institutional investors allocated 15% to hedge funds in 2023.
Verified18Hedge fund liquidations numbered 450 in 2023.
Verified19Equity hedge strategies returned 12.4% average in 2023.
Directional2065% of hedge funds had positive returns in 2023.
Single source21Hedge fund industry jobs totaled 350,000 globally in 2023.
VerifiedHedge Funds Interpretation
While the hedge fund industry swelled to a robust $4.3 trillion globally, proving its 2.1% edge over public markets came with a $120 billion vote of confidence from investors, it’s clear the game is increasingly won by a concentrated few, where the average "heads I win, tails you still pay 1.4%" fee model persists even amidst 450 funds being shown the door.
Industry Overview
1Global fund industry AUM totaled $120 trillion in 2023.
Verified2Passive funds overtook active funds with 48% market share in 2023.
Verified3Fund industry net flows were $2.5 trillion globally in 2023.
Verified4Number of global funds exceeded 130,000 in 2023.
Directional5U.S. fund industry AUM was $32 trillion end 2023.
Single source6Europe fund AUM reached $20 trillion in 2023.
Verified7Asia-Pacific fund assets grew 10% to $15 trillion in 2023.
Verified8Average fund expense ratio dropped to 0.55% globally in 2023.
Verified9ETFs and index funds captured 85% of new inflows in 2023.
Directional1060% of fund assets held by institutional investors in 2023.
Single source11Robo-advisors managed $1.5 trillion in funds by 2023.
Verified12ESG funds AUM hit $4 trillion globally in 2023.
Verified13Fund industry revenue was $250 billion in 2023.
Verified1475% of millennials prefer sustainable funds in 2023 surveys.
Directional15Active fund closures numbered 1,200 globally in 2023.
Single source16Fund industry tech spending reached $15 billion in 2023.
Verified1740% of funds used AI for portfolio management in 2023.
Verified18Global fund launches totaled 5,000 in 2023.
Verified19Women represented 22% of fund managers in 2023.
Directional20Fund industry AUM growth averaged 8% annually 2018-2023.
Single sourceIndustry Overview Interpretation
It seems the fund industry is having an identity crisis, with investors quietly voting for cheap, automated simplicity through passive funds while the industry itself, now a staggering $120 trillion behemoth, frantically launches new products and pours money into tech to justify its still-enormous $250 billion in revenue.
Mutual Funds
1In 2023, U.S. mutual fund total net assets reached $18.9 trillion, a 5.1% increase from 2022.
Verified2Equity mutual funds in the U.S. held $13.1 trillion in assets as of year-end 2023, representing 69% of total mutual fund assets.
Verified3U.S. bond mutual funds accounted for $5.2 trillion in assets at the end of 2023, down 2% from the previous year.
Verified4The number of U.S. mutual fund accounts grew to 330 million in 2023, up 1.2% from 2022.
Directional5Long-term mutual funds saw net inflows of $147 billion in 2023, primarily driven by equity funds.
Single source6Target-date mutual funds held $3.1 trillion in assets in 2023, comprising 16% of long-term fund assets.
Verified7Actively managed U.S. equity mutual funds averaged a 1-year return of 18.4% in 2023.
Verified8Passively managed U.S. equity mutual funds returned 21.2% on average over one year ending 2023.
Verified9U.S. mutual fund expense ratios averaged 0.44% in 2023, down from 0.52% in 2020.
Directional1056% of U.S. mutual fund assets were in retirement-related accounts in 2023.
Single source11U.S. money market funds held $6.3 trillion in assets at year-end 2023.
Verified12Retail investors held 42% of U.S. mutual fund assets in 2023, while institutions held 58%.
Verified13Actively managed bond mutual funds had net outflows of $210 billion in 2023.
Verified14The largest U.S. mutual fund, Vanguard Total Stock Market Index, managed $1.6 trillion in 2023.
Directional15U.S. mutual fund sales reached $8.5 trillion in 2023, with redemptions at $8.3 trillion.
Single source16Equity mutual funds represented 45% of new sales in U.S. mutual funds in 2023.
Verified1712b-1 fees accounted for 12% of total mutual fund expenses in 2023.
Verified18U.S. hybrid mutual funds held $1.4 trillion in assets end of 2023.
Verified1978% of U.S. mutual fund shareholders owned equity funds in 2023.
Directional20Average U.S. mutual fund turnover rate was 63% in 2023.
Single source21Municipal bond mutual funds had $0.7 trillion AUM in 2023.
Verified22U.S. mutual funds paid out $450 billion in dividends in 2023.
Verified2365% of mutual fund assets were passively managed by end of 2023.
Verified24Index mutual funds grew 15% in AUM in 2023.
Directional25U.S. balanced mutual funds returned 12.5% in 2023.
Single source2623 million U.S. households owned mutual funds in 2023, 42% of all households.
Verified27Foreign equity mutual funds held $1.2 trillion in U.S. in 2023.
Verified28U.S. mutual fund industry employed over 180,000 people in 2023.
Verified29Sector equity mutual funds made up 18% of equity fund assets in 2023.
Directional30U.S. mutual fund net issuance was positive $120 billion for equities in 2023.
Single sourceMutual Funds Interpretation
America's $18.9 trillion mutual fund love affair remains overwhelmingly focused on stocks—despite actively managed funds' often underperforming and pricier cousin—as a nation of savers keeps pouring money into the market, hoping to someday retire on something more than thoughts and prayers.
Private Equity
1Global private equity AUM reached $4.5 trillion in 2023.
Verified2Dry powder in private equity hit $2.6 trillion end 2023.
Verified3Private equity buyout deal value was $650 billion in 2023.
Verified4Number of PE firms worldwide exceeded 7,500 in 2023.
Directional5Venture capital investment totaled $340 billion globally in 2023.
Single source6PE exits generated $400 billion in proceeds in 2023.
Verified7Average PE fund IRR was 15.2% net for vintages 2018-2023.
Verified8Secondaries market volume reached $120 billion in 2023.
Verified9Growth equity deals made up 25% of PE activity in 2023.
Directional10U.S. PE AUM was $3.2 trillion in 2023.
Single source11PE fundraising totaled $700 billion in 2023.
Verified12Median PE holding period was 5.8 years in 2023.
Verified13Infrastructure PE AUM grew to $1.1 trillion in 2023.
Verified1455% of PE capital went to buyouts in 2023.
Directional15VC dry powder was $350 billion end 2023.
Single source16PE distributions to LPs were $500 billion in 2023.
Verified17Late-stage VC deals averaged $150 million in 2023.
Verified18PE multiple on invested capital (MOIC) averaged 2.1x in 2023.
Verified19Asia PE markets saw $180 billion invested in 2023.
Directional20PE fund sizes averaged $1.2 billion for new funds in 2023.
Single sourcePrivate Equity Interpretation
The private equity world, armed with a record-breaking $2.6 trillion in dry powder but deploying it at a historically measured pace, finds itself in a tense and expensive waiting room, simultaneously celebrating past returns while nervously eyeing the exit sign.
Sources & References
- Reference 1ICIici.orgVisit source
- Reference 2MORNINGSTARmorningstar.comVisit source
- Reference 3ETFGIetfgi.comVisit source
- Reference 4ETFetf.comVisit source
- Reference 5STATISTAstatista.comVisit source
- Reference 6SSGAssga.comVisit source
- Reference 7ETFTRENDSetftrends.comVisit source
- Reference 8PREQINpreqin.comVisit source
- Reference 9HFRhfr.comVisit source
- Reference 10BARCLAYHEDGEbarclayhedge.comVisit source
- Reference 11MCKINSEYmckinsey.comVisit source
- Reference 12BAINbain.comVisit source
- Reference 13CBINSIGHTScbinsights.comVisit source
- Reference 14CAMBRIDGEASSOCIATEScambridgeassociates.comVisit source
- Reference 15PITCHBOOKpitchbook.comVisit source
- Reference 16PWCpwc.comVisit source
- Reference 17EFAMAefama.orgVisit source
- Reference 18AMFamf.org.auVisit source
- Reference 19THINKINGAHEADINSTITUTEthinkingaheadinstitute.orgVisit source
- Reference 20MORGANSTANLEYmorganstanley.comVisit source
- Reference 21DELOITTEdeloitte.comVisit source
- Reference 22OTHORITYothority.comVisit source