JUNE 26, 2026

Why Advisors Are Ditching Mutual Funds for Sector ETFs

Why Advisors Are Ditching Mutual Funds for Sector ETFs

Summary

Record ETF inflows signal a pivotal shift in portfolio construction among financial advisors, with allocations expected to surpass mutual funds by 2027. As corporate buybacks replace dividends, advisors are increasingly favoring targeted sector funds, particularly in utilities and technology, to meet specific income and growth objectives. With global ETF inflows reaching $2 trillion in 2025, the forecast for assets has been revised upward to $63.49 trillion by 2035, highlighting the urgency for advisors to adapt their strategies.



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