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Besides some headwinds and volatility in the bond and stock markets, the European ETF industry enjoyed healthy estimated net inflows (+€25.0 bn) over the course of August. That said, these inflows were far below the rolling 12-month average (€26.3 bn). These inflows drove the overall inflows in ETFs up to €204.7 bn for the year 2025 so far. For more information on the assets under management and fund flow trends in the European ETF industry please read our European ETF Industry Review, August 2025.

The inflows in the European ETF industry for August were once again driven by equity ETFs (+€17.2 bn), followed by bond ETFs (+€5.6 bn), money market ETFs (+€1.8 bn), commodities ETFs (+€0.3 bn), mixed-assets ETFs (+€0.1 bn), and alternatives ETFs (+€0.1 bn).

In line with the overall sales trend for August, equity peer groups (+€14.4 bn) dominated the flows by asset class and were amongst the top 10 best-selling peer groups by estimated net inflows. That said, it was somewhat surprising that Money Market USD was more highly ranked than the best-selling bond classification on the table of the 10 best-selling classifications for the month. Given the overall fund flow trend in the European ETF industry, it was not surprising that Equity U.S. (+€6.7 bn) was the best-selling Lipper global classification for August, followed by Equity Global (+€5.4 bn), as these two classifications appears to be staples for European investors when it comes to ETF investments.

Graph 5: Ten Best- and Worst-Lipper Global Classifications by Estimated Net Sales, August 2025 (Euro Billions)

(Click on image to enlarge)

Source: LSEG Lipper

Generally speaking, it is not surprising that Equity U.S. has returned to the top spot on the table of the 10 best-selling Lipper classifications, given its status as a core market and the strong recovery of the market after the turmoil in April 2025, as well as the positive results reported during the last earnings season.

Is There a Flight to Quality Underway?

A view on the end of the league table may lead to the assumption that European investors are selling non-core positions, to possibly buy into Equity U.S., Equity Global, or Equity Europe, since at least eight of the 20 classifications with the highest outflows could be considered as tactical assets, or non-core holdings. That said, the cumulative outflows (-€0.6 bn) from these seven classifications (Equity Emerging Markets Global Small & Mid Cap (-€0.04 bn), Alternative Equity Leveraged (-€0.04 bn), Equity Emerging Markets Latin America (-€0.05 bn), Bond Global Corporates in Local Currencies (-€0.05 bn), Equity China Small & Mid Cap (-€0.1 bn), Equity Turkey (-€0.1 bn) Equity India (-€0.1 bn), and Commodity Other (-€0.2 bn)) were more than offset by the inflows into Equity Emerging Markets Global (+€1.0 bn).

To summarize this, it can be said that the outflows from these classifications are too small to be considered a trend. However, these numbers do indicate that European investors may be streamlining their portfolios by selling some non-core holdings, while buying into risk assets that are somewhat considered as core holdings in a diversified portfolio.

To summarize, the outflows across these classifications are too modest to be read as a secular trend. However, the values do suggest that European investors may be structurally repositioning away from non-core exposures, while rotating into riskier assets that serve as core holdings within a diversified portfolio.

Is the Trend Towards European Equities Still Intact?

A trend that could be observed over the first two quarters of 2025, was that European investors bought into European equities to balance their portfolios. Equity Eurozone (+€0.9 bn) was the fourth best-selling classification for August, while Equity Europe (+€0.3 bn) was 17^th. Since European investors are still reluctant when it comes to small & mid-caps, it was not surprising to witness that Equity Europe Small & Mid Cap (+€0.02 bn), and Equity Eurozone Small & Mid Cap (+€0.002 bn) had only very shy inflows. Regarding this, it can be said that the tide has not changed, but the flows towards Europe over the course of August weren’t as high as they were in earlier months of the year.

What is Going on in Money Markets and Bonds?

It was somewhat surprising to see Money Market USD (+€1.1 bn), taking the third spot, and Bond USD Government (+€0.7 bn), taking the fifth spot on the table of the best-selling classifications, despite the ongoing weakening of the U.S. dollar compared to the euro. Both classifications were outpacing their euro-denominated peers, as Money Market EUR (+€0.7 bn) came in the seventh spot and solidified a position on the table of top-selling Lipper classifications., while Bond EMU Government (+€0.4 bn) held the twelfth spot. That said, the best-selling euro-denominated bond classification was Bond EUR Corporates Short Term (+€0.5 bn), which came in as the eighth best-selling classification for the month.

More generally, it might be a topic of interest that the cumulative outflows from the 10 peer groups with the highest estimated net outflows for August (-€1.3 bn) were below the cumulative outflows for the 10 peer groups with the highest outflows for July 2025 (-€3.8 bn).

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