The exchange-traded fund industry is about to reach a major milestone.
Over the next few days—maybe as early as Friday—ETFs as a category will pass $2 trillion in assets. The accomplishment serves as a mighty rebuke of the mutual fund industry as investors during this five-year bull market wholeheartedly rejected active management.
After a $42 billion inflow for November, ETFs are less than $3 billion away from the $2 trillion mark, according to XTF.com, which calculates the asset total at the end of each day.
Comparatively, mutual funds added just $12 billion last month, as investors are clearly choosing ETFs as the vehicle to ride this stock market to higher and higher record highs.
November was the fourth-largest month for ETF inflows in the last decade, according to XTF.com.
"ETFs are a reminder that 'disruptive technology' isn't just for Silicon Valley," wrote Nicholas Colas of Convergex Group, in a note to clients this week. "It happens in our business as well."
Over the last five years, investors put $301.5 billion into U.S. equity ETFs, while pulling $411.1 billion out of mutual funds, according to Colas.