Which ETF sectors are attracting the most investment?

Three stacks of coloured coins representing exchange-traded fund flows — (Image credit: Richard Drury via Getty Images)

While equity markets stuttered in July – the MSCI World Index, which represents 85% of the total market capitalisation of each developed market in the world, grew just 0.5% during the month – flows into exchange-traded products were strong.

European-listed exchange-traded funds (ETFs) and exchange-traded commodities (ETCs) attracted flows of €47.3 billion in July, up 28.5% from €36.8 billion the previous month, according to data from investment research firm Morningstar.

Fund flows can give a broad indication of how investors feel about the market at a given point of time, though there is of course no guarantee that this will continue in future.

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Among European-listed ETFs, those focusing on equity investing attracted €34.2 billion in flows during July, up from €29.9 billion in June. ETFs tracking bonds attracted €8.8 billion in July, up from €7.7 billion in June.

The Europe-listed ETF sectors that saw the biggest inflows and outflows

Blend equity ETFs (those holding a combination of value and growth stocks) saw some of the largest inflows among Europe-listed equity ETFs during July, according to Morningstar’s analysis.

Global large cap blend equity ETFs attracted €10.1 billion in flows during the month, followed by US large cap blend equity at €8.6 billion.

While ETFs that contained a blend of US large- and small-caps saw the largest flows, their counterparts that focused on either growth or value saw divergent flows. ETFs targeting US large cap growth stocks were among those that saw the largest outflows (€1.4 billion worth), but US large cap value ETFs saw outflows of €117 million.

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Europe-listed Equity ETF Net Flows by Morningstar category, July 2026
Top 10	Net flow (€ million)	Bottom 10	Net flow (€ million)
Global large cap blend equity	10,108	US large cap value equity	-117
US large cap blend equity	8,584	Brazil equity	-149
Global emerging markets equity	3,574	Asia ex-Japan equity	-197
Japan large cap blend equity	1,844	Latin America equity	-213
Global equity income	1,571	Germany equity	-248
US large cap growth equity	1,414	China equity	-382
Sector equity financial services	1,374	US small cap equity	-395
Europe large cap blend equity	1,148	China equity – A shares	-422
Sector equity technology	1,120	Europe ex-UK equity	-442
Other equity	873	Global large cap value equity	-539

^{Source: Morningstar Direct. Data as of 31 July 2026.}

“Interestingly, we saw little evidence of a meaningful rotation into defensive or value strategies during the pullback,” said Garcia-Zarate.

The ETF sectors that saw the largest outflows were global large cap value, which saw outflows of €539 million, and Europe ex-UK with €442 million in outflows.

Which Europe-listed ETFs saw the largest flows during July?

Vanguard’s FTSE All-World UCITS ETF (LON:VWRP) topped the list of ETFs seeing the largest inflows during July, with €3.3 billion flowing into the fund. iShares MSCI Japan ETF (LON:IJPN) came second, with €1.6 billion inflows.

State Street SPDR MSCI World ETF (LON:SWLD) saw the largest outflows, at €1.9 billion, followed by Xtrackers S&P 500 Swap ETF (LON:XSXG) which registered €981 million outflows.

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Europe-listed Equity ETF Monthly Flows by Fund: Top 10/Bottom 10 in July 2026
Top 10	Net flow (€ million)	Bottom 10	Net flow (€ million)
Vanguard FTSE All-World ETF	3,308	iShares Edge MSCI World Value Factor ETF	-328
iShares MSCI Japan ETF USD Dist	1,571	Xtrackers MSCI World Value ETF	-334
UBS Core MSCI EM UCITS ETF	1,453	iShares MSCI China ETF	-434
iShares Core MSCI World ETF	1,179	Ossiam Lux Ossiam Shiller Barclays Cape US Sector Valu	-467
UBS MSCI ACWI Climate Paris Aligned ETF	1,145	L&G Europe ex-UK Equity ETF	-522
Xtrackers S&P 500 Swap II UCITS ETF	1,039	State Street SPDR S&P 500 Quality Aristocrats ETF	-734
iShares CORE MSCI EM IMI ETF	977	iShares Edge MSCI USA Value Factor ETF	-773
Xtrackers S&P 500 Equal Weight ETF	960	UBS MSCI ACWI Socially Responsible ETF	-957
State Street SPDR MSCI All Country World ETF	947	Xtrackers S&P 500 Swap ETF	-981
Xtrackers S&P 500 ETF	862	State Street SPDR MSCI World ETF	-1,887

^{Source: Morningstar Direct. Data as of 31 July 2026.}

What happened to global ETP flows in July?

The data on flows into European-listed ETFs and ETCs was consistent with the picture that global ETP flows painted.

Global flows into exchange-traded products (ETPs) – which includes ETFs and ETCs – hit a record $362.6 billion in July, according to data from asset manager BlackRock.

BlackRock’s analysis showed that flows into equity ETPs rose for the third consecutive month to $64.8 billion.

Flows into tech ETPs reached a record $60.5 billion in July, smashing through the previous record of $32.0 billion, set the previous month.

Dan is a financial journalist who, prior to joining MoneyWeek, spent five years writing for OPTO, an investment magazine focused on growth and technology stocks, ETFs and thematic investing.

Before becoming a writer, Dan spent six years working in talent acquisition in the tech sector, including for credit scoring start-up ClearScore where he first developed an interest in personal finance.

Dan studied Social Anthropology and Management at Sidney Sussex College and the Judge Business School, Cambridge University. Outside finance, he also enjoys travel writing, and has edited two published travel books.