Image Source: Pixabay

The European ETF industry does show a high concentration of the assets under management (AUM) on different levels. In order to examine the concentration of the AUM in the European ETF industry beyond the ETF promoter level, this article reviews concentration of the assets under management at classification level. This analysis should lead to more insights on the structure and concentration of assets under management within the European ETF industry.

At the end of June 2025, the European ETF market was split into 178 different peer groups. That said, the largest assets under management were held by funds classified as Equity U.S. (€535.9 bn), followed by Equity Global (€400.2 bn), Equity Europe (€107.4 bn), Equity Emerging Markets Global (€95.6 bn), and Equity Eurozone (€80.1 bn).

Graph 1: The Twenty Largest Lipper Global Classifications by Assets Under Management, June 30, 2025 (Euro Billions)

(Click on image to enlarge)

Source: LSEG Lipper

These numbers speak clearly with regards to the concentration of the assets under management on classification level, as the largest classification (Equity U.S.) had a market share of 24.38% of the overall assets under management at the end of June 2025, while the second largest classification (Equity Global) held 18.20% of the overall AUM. This means these two classifications accounted for 42.58% of the overall assets under management.

As shown by graph 1, the market share of the following classifications is way smaller, but still significant. As a result, the five largest classifications accounted for 55.45% of the overall assets under management in the European ETF segment, while the 10-top classifications by assets under management accounted for 65.40%.

Overall, 17 of the 178 peer groups each accounted for more than 1% of assets under management. In total, these 17 peer groups accounted for €1,649.5 bn, or 75.03%, of the overall assets under management.

These numbers show that the assets under management in the European ETF industry are also highly concentrated on classification level.

Nevertheless, the dominance of the 20 largest Lipper classifications is also visible in the estimated net flows by Lipper classifications. The three largest classifications—Equity Global (+€35.7 bn), Equity Europe (+€15.1 bn) and Equity U.S. (+€12.6 bn)—were also the three classifications which enjoyed the highest estimated net inflows over the course of the first half of 2025.

Graph 2: The Twenty Best-Selling Lipper Global Classifications, H1 2025 (Euro Billions)

(Click on image to enlarge)

Source: LSEG Lipper

 
Overall, there were 15 of the twenty largest classifications on the table of the twenty best-selling classifications over the course of the first half of 2025. These 15 classifications accounted for estimated net inflows of €119.0 bn or 78.07% of the overall estimated net inflows in the European ETF industry over the course of H1 2025.

With regard to the above, it can be said that the assets under management in European ETF industry on classification level are highly concentrated. That said, the high concentration of the AUM should not be seen as a hindrance to competition in the European ETF industry, since the rankings of the largest classifications saw some movement in single positions over the past few years. This indicates that the positions of single classifications are an object of change once European investors trade the respective ETFs according to their market views. Even as some of these positions might be core holdings, once investors got into risk-off mode they also reduced their exposure to core asset classes. This means that fund flows and the performance of the underlying markets are changing the order of the largest classifications.

Having said that, the large size of some of the ETFs within the top 20 classifications by assets under management can become a barrier to entry the market for new ETF promoters, since high assets under management mean that an ETF might be still profitable, even as it charges very low fees. The so-called race to zero is especially visible in the largest classification (Equity U.S.) were the cheapest ETF charges its investors only 0.03% in management fees for an S&P 500 ETF. Since management fees are a marketing tool in the core asset classes, this offer is clearly a hindrance for the launch of plain vanilla U.S. equity products by new ETF promoters. Nevertheless, it is not a hindrance for more innovative or actively managed products within this classification.

More By This Author:

Q2 2025 U.S. Retail Scorecard - Update
S&P 500 Earnings Dashboard 25Q2 - Friday, Aug. 22
Russell 2000 Earnings Dashboard 25Q2 - Thursday, Aug. 21