JPMorgan report finds dramatic jump in AI-themed ETFs — despite rough quarter
Get the Finance newsletter
Daily finance — markets, central banks, M&A, the prints that move money. Free.
- J.P. Morgan Asset Management published its Guide to ETFs this month, finding AI-themed ETFs now rank among the top five themes by assets under management despite second-quarter volatility in the group.
- Jon Maier, the firm's chief ETF strategist, told CNBC's "ETF Edge" that many ETF themes are "morphing towards AI and the ecosystem surrounding AI," spanning applications, energy, and AI models.
- The same report found mutual fund inflows are "meaningfully tapering off" with negative overall inflows over the past several years as more money shifts into ETFs.
- Maier attributed part of the ETF appeal to retail-friendly tax treatment, noting ETFs "typically don't pay a capital gain [tax]."
- On the mutual fund side, Maier pointed to the frustration of investors who bought in 2022 and are down 20%–40% yet still received a 6% capital gain distribution.
Why it matters: J.P. Morgan's data shows a structural capital migration from mutual funds to ETFs — driven largely by tax efficiency — with AI as the gravitational center of the inflows. Retail investors bearing capital gains on 20%–40% mutual fund losses are the clearest losers in the shift, while ETF issuers and AI-exposed companies capture the redirected dollars.
