Europe’s ETF Horizon:
Our 6 Predictions for 2026

White-label UCITS platforms are increasingly favoured by institutional- scale asset managers seeking speed-to-market, lower operational complexity, risk mitigation and reduced costs compared to building proprietary infrastructure. In 2026, we expect white-label platform AUM to double to $11.2bn. This growth reflects a broader market trend of managers outsourcing infrastructure to enable greater focus on distribution investor engagement, and product innovation.

ETF adoption in Europe continues to accelerate and we expect to see record ETF inflows of $470bn in 2026 (up from $390bn in 2025). This growth reflects the ongoing shift toward ETFs as core investment products in both retail and institutional portfolios and issuers embracing ETFs for distribution and scalability.

Active ETF innovation is gathering pace, driven by investor appetite for differentiated strategies and transparency. In 2026, we expect over 200 new active UCITS ETFs—a 50% increase from 2025—led by large asset managers seeking to diversify product ranges and capture flows. This trend signals a maturing market where active ETFs become a mainstream choice for European investors alongside passive products.

The Irish Government cut the ETF Investment Undertaking Tax for investors from 41% to 38% effective from 1 January 2026, as part of the EU Savings and Investments Union Initiative to help enhance Ireland’s competitiveness and encourage long-term investing. While this was welcomed, Irish investors do not get full parity with other investment types on capital gains treatment. We predict the Irish Government to continue toward parity and announce a further 3% relief to investors in 2026. This would narrow this gap, making Ireland an even more attractive domicile for UCITS ETFs.

While there have been promising recent developments, ETF share classes are not a universal solution for market entry in Europe. There are operational, tax, regulatory and commercial hurdles which need to be solved on a case-by-case basis. We expect slower uptake than anticipated for share class adoption in 2026, with issuers instead favouring easier ETF entry routes. This reflects the complexity of aligning regulatory frameworks with investor demand for flexibility.