Board of Governors of the Federal Reserve System

Figure 1. ETF and Mutual Fund Flows

Figure 1 shows a stacked bar chart comparing ETF and Mutual Fund Flows from 1998 to 2024, measured in billions of dollars. The vertical axis ranges from -$600 billion to $1,000 billion, with $200 billion increments. The horizontal axis shows years from 1998 to 2024 in two-year intervals. Each year has two bars: a blue bar for ETF flows and a cream bar for Mutual Fund flows. Positive values extend upward, negative values extend downward. ETF flows are consistently positive and generally increasing over time, reaching nearly $900 billion in 2024. Mutual Fund flows are negative in recent years, reaching about -$500 billion in 2024. The source of the data is Morningstar Direct.

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Figure 2. ETF Ownership and Volatility

Figure 2 is titled "ETF Ownership and Volatility" and shows a line graph comparing two groups of stocks: Stocks with Low ETF Ownership Increase and stocks with High ETF Ownership Increase. The horizontal axis represents months from April 2021 to October 2021. The vertical axis shows Average Volatility, ranging from 0.020 to 0.032. A vertical dashed line labeled "Conversion Date" is shown at June 2021. A solid orange line with circular markers represents Low ETF Ownership Increase. A dashed black line with square markers represents High ETF Ownership Increase. The graph indicates that stocks with high ETF ownership increases experience declines in their daily stock price volatility while stocks with low ETF ownership increases do not change significantly. Sources cited at the bottom of the image are the Center for Research in Security Prices, CRSP Survivor-Bias-Free US Mutual Fund Database, Wharton Research Data Services, and CRSP 1925 US Stock Database.

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