US ETF industry sees record 390 launches in 2 months, and half of them use derivatives

By early May, 370 new ETFs had already hit the market, comfortably outpacing 2025’s tally of 290 by the same point. By late July, that number ballooned to 953 total launches, putting the industry on a trajectory to blow past the all-time annual record of 1,095 set back in 2021. Derivatives and leverage everywhere A full 50% of the ETFs launched this year incorporate derivatives, a record-high proportion. Half of all new ETFs are using options, swaps, or futures contracts as core building blocks rather than just holding baskets of stocks. There are now 701 leveraged and inverse products on the market, more than double the count at the end of 2024. These funds are engineered to amplify returns on individual stocks or specific themes, like memory chips and AI technologies. Some of the AI-focused offerings have already crossed $3 billion in assets under management. Meanwhile, 85% of this year’s new launches are active strategies, meaning a human (or at least a human-designed algorithm) is making decisions about what to buy and sell, rather than passively tracking an index. Crypto ETFs keep rolling off the line Multiple spot Bitcoin and Ethereum ETFs have launched this year, building on...