Over the past decade, the global Exchange-Traded Fund (ETF) market has seen an unprecedented surge in popularity and development, molding a landscape where the notion of “the rich get richer” has never been more apparentEnding the year 2021, the number of ETFs worldwide soared to 9,877 with assets under management at an astonishing $10.3 trillion—a remarkable year-over-year growth of 28.5%.

As the world grappled with the economic ramifications of the COVID-19 pandemic, countries around the globe maintained loose monetary policies in 2021. This strategy resulted in an influx of capital into the ETF markets, setting new records for net inflows, which reached a staggering $1.3 trillion—a stark increase from $762.87 billion in 2020, representing a 70% riseEquity ETFs, in particular, witnessed a net inflow of $910.16 billion, marking a remarkable year-over-year increase of 148.9% and accounting for 70.3% of total net inflows

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In contrast, fixed-income ETFs garnered $238.95 billion, representing 18.5% of the total, with a modest growth of 3.6%. Interestingly, commodity ETFs faced a stark reversal, experiencing a net outflow of $10.17 billion, flipping from a net inflow of $61.25 billion in the previous year.

As of the end of 2021, the distribution of ETF types reveals a predominant focus on equities, which comprise 75% of the marketFixed-income ETFs represented 19% and commodities clamored at a mere 3.4%. Notably, within the equity ETF segment, the largest player is the SPDR S&P 500 ETF, aggressively maintained by State Street Global Advisors, which, as of April 29, 2022, boasted an impressive size of $355.1 billionMeanwhile, the largest fixed-income ETF is managed by BlackRock's iShares Core U.SAggregate Bond ETF, holding $82.6 billion; and in the commodities corner, the SPDR Gold Shares is the biggest, with a valuation of $67.2 billion, as per the same date.

The inception of the global ETF phenomenon dates back nearly three decades to 1993, when the first ETF—the now largest SPDR S&P 500 ETF—was established in the United States

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Since then, with the exception of a brief contraction during the 2008 global financial crisis, the trajectory of asset growth has been consistently upwardThe ETF market traversed significant thresholds: it first surpassed the $1 trillion mark in 2009, crossed $2 trillion in 2013, and breached $3 trillion by 2016; the growth did not slow down, with $4 trillion reached by 2017, $6 trillion by 2019, and finishing 2021 at a striking $7.21 trillion.

However, a pronounced “Matthew effect” characterizes the global ETF market, reflecting a disparity where major markets in North America and Europe seize the bulk of the ETF landscape, reinforcing their established strongholdLooking at geographical distribution, the scale of ETFs is overwhelmingly dominated by the U.Sand Europe.

By the end of 2021, the United States firmly held the title of the largest ETF market globally, with a staggering 2,805 products spread across 234 issuers, valued at $7.21 trillion, which represented 70.2% of the total global market

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Europe followed with 89 issuers and 2,616 products, managing a commendable $1.60 trillion, which accounted for 15.6% of the market, increasing by 24.7% year-over-yearThe Asia-Pacific region showcased 218 issuers with 2,308 products, boasting total assets around $543.1 billion, which occupied a 5.3% share of the global market.

Focusing on the U.Sdata, as of May 23, 2021, the 2,146 ETFs tracked had aggregated an astonishing $6.25 trillion in assets, approximately 80% of the total assets managed worldwideNotably, there were 128 ETFs each managing over $10 billion, which combined represented an overwhelming $4.66 trillion, or 75% of the assets managed by the U.SETFs, underscoring a clear trend of capital gravitating towards leading ETFsIn fact, ETFs have emerged as the primary growth force in the U.Sinvestment industry, significantly energizing the market post the 2008 financial crisis, particularly with hybrid-stock ETFs dominating; they reached a value of about $3.6 trillion, making up nearly 86% of the U.S

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equity ETF market by the end of 2021.

In Europe, however, many ETF investments are funneled through Ireland, which ranks as the second-largest ETF market globally, with a total valuation of $960.3 billion by the end of 2021. This position is remarkable against the backdrop that the entire European ETF market was valued at about $1.60 trillion in the same periodUnlike its American counterparts, commodity ETFs enjoy greater popularity in Europe, representing a notable 9% segment of the market, in stark contrast to the mere 2% captured by the U.S.

From the perspective of asset managers, the United States remains supreme as the birthplace of ETFs, with the highest numbers of managers and assets under management, registering three major players: BlackRock, Vanguard, and State Street Global Advisors