On April 11, 2000, the first two ETFs listed in Europe started trading at Deutsche Börse. The iShares Core EURO STOXX 50 UCITS ETF and the iShares STOXX Europe 50 UCITS ETF — at the time managed by Merrill Lynch[1] — tracked two STOXX benchmarks, and are still trading today with more than EUR 17 billion under management.
The launch in Frankfurt 25 years ago was a seminal moment best appraised with hindsight. Today, the ETF is a staple investment vehicle that keeps growing in portfolios of all sizes and types. Over 2,700 funds trade in Europe with a total of EUR 2.2 trillion (USD 2.4 trillion) in assets,[2] an impressive 37% increase in invested capital compared to the start of 2024.
“As a vehicle for implementing a wide range of strategies, the ETF structure has profoundly democratized investing and has transformed the asset management landscape,” said Axel Lomholt, General Manager at STOXX. “We congratulate Deutsche Börse on this anniversary and look forward to continuing to break new ground together in the innovative and fast-growing ETF segment.”
Attractive features of the ETF
From the onset, the ETF quickly became popular among investors as a one-stop, low-cost and transparent vehicle to gain exposure to multiple strategies and regions, and attain rapid diversification. Because ETFs are listed like shares, they provide liquid and real-time points of entry and exit, and help price discovery in times of market volatility.
STOXX, which started its operations only two years before the listing of the first ETFs in Frankfurt, today provides the underlying index for 300 funds worldwide with EUR 149 billion under management in total.[3]
Other pioneering ETFs in Europe include the iShares Core DAX UCITS ETF, which was the first DAX ETF, launched in 2000 by HypoVereinsbank. Today, the fund is managed by BlackRock.
Over two decades of innovation
As STOXX expanded into new areas in recent years, the ETF was often the vehicle of choice to capture innovation. As such, fund issuers adopted groundbreaking indexing solutions in sector, volatility, thematic, dividend, smart beta, sustainability and even fixed-income strategies to meet investor demand.
Successful ETFs in those areas include the iShares Automation and Robotics ETF, Deka Deutsche Börse EUROGOV®Ger 1-3 ETF and Amundi DAX 50 ESG ETF, to name only a few. They add to funds tracking benchmarks such as the EURO STOXX 50®, STOXX® Europe 600 and DAX® that have reached several billion euros in assets, managed by the likes of Amundi, iShares, BNP, UBS, Xtrackers, Invesco, UBS and Deka.
Outlook
Despite the extensive adoption of ETFs in Europe to date, there is still room for more growth. Europe’s ETF industry accounts for just 15% of the global AuM in ETFs, and nearly a tenth of all money in investment funds in Europe[4]. ETFs in Europe represent 11% of the total market capitalization of the region’s equities, according to STOXX calculations. That’s significantly lower than the 19% of the US stock market that’s invested in American ETFs.
EY has estimated that the European ETF industry may reach over EUR 4.9 trillion[5] in AuM by 2030, more than double the amount in early 2025.
Platform for growth
Today, the ETF remains one of the most efficient instruments for direct portfolio investments. Managers and investors favor the transparency of their methodologies, the low cost of the funds, and the liquidity and security provided by exchanges such as Deutsche Börse.
Non-stop innovation and the incursion in new asset classes such as cryptocurrencies suggest that the next 25 years will be as exciting and revolutionary for ETFs as the last quarter century.
[1] The funds were taken over by BlackRock in 2009.
[2] Source: STOXX. Covers all ETFs domiciled in EMEA at the end of March.
[3] Source: STOXX.
[4] Based on EUR 17.1 trillion that were placed in investment funds in Europe at the end of 2023, according to EFAMA.
[5] Currency conversion done by STOXX.