Investment firms are on track to launch a record number of exchange traded funds this year, with more than 1,000 already debuted, as they opt for a “spaghetti cannon” approach to try to find the latest hot stock market trends.
As of mid-July, 1,084 new ETFs had been listed, including funds offering leveraged bets on equity indices or individual stocks. That compares with 2025’s record full-year tally of 1,161 and is well above the total for any previous year, according to data firm Morningstar.
The surge in launches highlights how a wide range of fund providers — including relatively unknown firms with little in the way of a record of managing money — are attempting to emulate the success of vehicles such as the Roundhill Memory ETF or the iShares Bitcoin Trust. Both sucked in billions of dollars in a matter of months by offering investors exposure to highly fashionable market themes.
“The spaghetti cannon [of launches] is firing wildly right now and not even hitting the wall in some instances, let alone sticking,” said Bryan Armour, director of passive strategies research for North America at Morningstar.
The wave of new listings comes amid surging investor demand for ETFs, particularly in the US, where they offer tax advantages over more traditional mutual funds. These portfolios historically provided low-cost passive exposure to an index or group of stocks or other securities but now offer a wider range of investments.
Net inflows to US-listed ETFs exceeded $1tn in the first half of this year, according to State Street Investment Management, which forecasts full-year inflows of $2.3tn, well above the $1.5tn seen for 2025 and roughly four times the typical annual amount for the early 2020s.
Roundhill’s fund, which invests in a narrow group of chipmakers and has the stock market ticker DRAM, rocketed through $10bn in assets in just 50 days following launch, as investors clamoured for exposure to stocks benefiting from the huge wave of AI investment.
Some firms are taking the approach of multiple launches to extremes.
Venture capital-backed start-up Corgi Funds began launching in December and has now debuted 188 funds, including the Coffee and Energy Drinks, Buy Now Pay Later and War Machine ETFs, as well as vehicles offering twice-leveraged exposure to Chinese internet, Taiwanese and Korean stocks. It has filed to launch 360 more.
That puts it on course to overtake BlackRock — the world’s largest asset manager, which has 488 US ETFs, according to StockAnalysis — as the biggest issuer by number of funds in a matter of months. However, BlackRock’s assets in US ETFs total $4.5tn, compared with less than $1bn for Corgi.
“We recognise that not every fund is going to be a winner,” said Anthony Crinieri, a portfolio manager at Corgi, adding that he anticipates roughly 20 per cent of the funds the company launches will gather 80 per cent of its assets.
“We expect . . . to be able to cover our costs by having outsize winners on enough of that 20 per cent,” he added.
Almost a quarter of this year’s launches have been leveraged single-stock funds in a sign of investors’ growing appetite for risky bets even on volatile names. That is up from 20 per cent last year and just 4 per cent in 2024.
Leverage Shares, GraniteShares, Defiance ETFs and T-Rex are among other prolific issuers this year, largely focused on leveraged and inverse ETFs, with launches including funds offering twice the daily return on stocks such as SpaceX and SK Hynix.
Morningstar’s Armour said leveraged single-stock ETFs were “awful long-term investments on average”, but investors nevertheless often clamour for access when the underlying stock is soaring.
Many of the other launches have been actively managed, thematic or derivatives-based vehicles such as buffer ETFs, which provide a degree of downside protection. Very few have been the broad-market tracker funds that have traditionally been the mainstay of the industry.
“There is some craziness in the launches that have come to market and then there are some lower-cost alternatives to established benchmarks as well,” said Todd Rosenbluth, head of research at consultancy TMX VettaFi, referring to the cheaper alternatives to Invesco’s $470bn Nasdaq 100-tracking QQQ ETF recently launched by State Street and BlackRock.
Todd Sohn, chief ETF strategist at Strategas Asset Management, said many of the recent launches were merely copycats.
“Someone launches a semiconductor memory or photonics ETF and then all of a sudden you have three or four of these,” he said.
Investors are increasingly favouring ETFs over mutual funds because of their greater transparency, ease of trading, generally lower fees and increasingly broad range of investment strategies. While the total number of US ETFs, at almost 6,000, remains below mutual funds at 8,030 as at the end of 2025, according to the Investment Company Institute, many in the industry see room for ETFs to continue their rapid growth.
“There’s a wave of thematic funds coming, all based on AI,” said Sohn. ETFs based on prediction markets, if approved by the Securities and Exchange Commission, “would really dial up the number”.