The active ETF wave is the biggest structural story in European investing this year, with more than 200 new active UCITS ETF launches expected in 2026 alone. That is not a niche trend. It is a full-scale land grab, and the marketing money behind it is aimed squarely at investors like you and me. In this analysis I set out what is launching, why it is happening now, what “active” really means once you read past the label, and how a sensible European investor should respond. Spoiler: my passive core is not going anywhere. But I no longer dismiss the whole category, and I will explain where active earns its keep.
What the active ETF wave looks like in numbers
Start with the headline forecast. Waystone, one of the largest white-label ETF platforms in Europe, predicts more than 200 new active UCITS ETFs in 2026 — roughly 50% up on 2025, itself a record year. Waystone also expects over 20 brand-new issuers to enter the European market this year, many of them American and Asian managers arriving via white-label platforms rather than building their own infrastructure.
The names arriving are not small. AllianceBernstein, a manager running roughly $860 billion, launched its European active ETF business in April 2026 with three Luxembourg-domiciled corporate bond ETFs, with equity and thematic funds filed to follow. Schroders, Jupiter, Columbia Threadneedle, Robeco and Goldman Sachs have all been expanding or preparing active ranges. Meanwhile JPMorgan, the incumbent leader, added a Europe-focused equity premium income ETF (JEPE) in early 2026 and has begun merging a $1.6 billion traditional fund into an ETF wrapper. I looked at how the incumbent’s funds have actually performed in my JPMorgan active ETFs performance analysis.
The flows confirm the momentum. The European ETF market is approaching $3 trillion in assets, and active ETFs pulled in over $4 billion of net inflows in January 2026 alone, after a record 2025. Active is still a small slice of the total. But it is the fastest-growing slice, and every issuer without an ETF range now feels compelled to build one.
Why the active ETF wave is breaking now
Three forces are driving this, and only one of them is about you.
First, the JEPI effect. In the United States, JPMorgan’s equity premium income ETF became one of the most successful launches in history by paying a high monthly income from an options overlay. The European copies, launched under UCITS rules, have gathered assets fast, and success breeds imitation. Income-hungry investors turned out to be the beachhead for the whole active category.
Second, the wrapper is simply better. An active ETF is usually cheaper than the same manager’s traditional mutual fund, trades intraday, has no entry fees or distribution kickbacks baked in, and is available in any broker app. For a fund house, the ETF wrapper is often the only way to reach the new generation of self-directed European investors, who buy through savings plans rather than bank advisers.
Third, issuer margins. This is the honest part nobody prints in the brochure. Passive ETF fees have been ground down to a few basis points, and issuers make very little on them. An active ETF charging 0.25–0.70% is several times more profitable per euro of assets. This wave is partly a response to investor demand, and partly an industry searching for margin. Keep both motives in mind when you read the marketing.
The three kinds of “active” — and why the label misleads
“Active” now covers wildly different products, and lumping them together is the fastest way to buy the wrong one. The new launches fall into three broad families, plus active bond funds, which I treat separately below.
Shy-active, or research-enhanced. These funds hug the index. They take small stock overweights and underweights, keep tracking error deliberately tight, and aim to beat the benchmark by a fraction of a percent per year. JPMorgan’s Research Enhanced Index range is the classic example: index funds with a modest tilt, priced accordingly.
Genuinely active. High-conviction stock picking with real deviation from the index. Many new thematic launches sit here: concentrated portfolios, big sector bets, and outcomes that can differ from the market by ten or twenty percentage points a year, in either direction. I covered this corner in my guide to thematic active ETFs.
Income overlays. The JEPI-style funds. They hold a broadly market-like equity portfolio and sell call options on top to generate monthly income. You trade away some upside in strong markets for a high, steady distribution. My JEPG review walks through the largest global example available to Europeans.
The table below summarises the categories, the fee bands I typically see, and what each is actually for. All fee figures are illustrative bands, not quotes — always check the live TER on the issuer factsheet.
| Category | Typical TER band | What it actually does | Sensible role |
|---|---|---|---|
| Shy-active / research-enhanced | ~0.20–0.30% | Hugs the index with small stock over- and underweights; tight tracking error | Possible core substitute, if the fee gap over passive stays small |
| Genuinely active / thematic | ~0.35–0.70% | High-conviction stock picking; real deviation from the market | Small satellite only; size it so being wrong doesn’t hurt |
| Income / options overlay | ~0.30–0.40% | Market-like equity portfolio plus call-writing for monthly income | Income sleeve; accept capped upside as the price of yield |
| Active bond | ~0.15–0.40% | Manages duration and credit instead of tracking debt-weighted indices | Fixed-income allocation, where indexing is structurally weakest |
| Passive index (reference) | ~0.03–0.22% | Tracks the market, nothing more | The core, for most investors, most of the time |
The fee reality versus passive
Fees are where the trend analysis has to get cold. A world equity tracker now costs as little as 0.07–0.22% a year, and an S&P 500 UCITS ETF can be had for 0.03–0.09%. The new active launches mostly sit between 0.20% and 0.70%. That gap sounds small. Compounded over twenty years on a six-figure portfolio, it is tens of thousands of euros — money the manager must earn back through skill, every year, before delivering any genuine outperformance.
To be fair, the same strategies used to cost far more. A traditional active mutual fund sold through a European bank often charges 1.5–2% including distribution fees, plus entry charges. Against that, a 0.35% active ETF is a dramatic improvement. So the honest framing is this: active ETFs are much cheaper active management, but still expensive index-plus exposure compared with pure passive. I break down the full trade-off in my active versus passive ETFs guide.
The SPIVA problem nobody launching funds wants to discuss
Here is the inconvenient evidence base. S&P’s long-running SPIVA scorecards, which compare active funds against their benchmarks, keep finding the same thing across regions and decades: the large majority of active equity funds underperform their benchmark over long horizons, and the failure rate rises the longer the period you measure. A fund that shines over three years usually cannot repeat it over fifteen. Persistence — the same manager winning again and again — is rarer still.
A cheaper wrapper does not repeal this arithmetic. Active ETFs lower the cost hurdle, which genuinely improves the odds versus old-style mutual funds. But the average active equity ETF still has to overcome its fee, its trading costs, and the brutal reality that markets are hard to beat. The 200+ launches will produce some winners. They will also produce a long tail of funds that quietly close after underperforming, and nobody sends a press release about those.
Where active can genuinely earn its keep
I am not an absolutist, and two areas deserve a fair hearing.
Income overlays. A covered-call fund is not really trying to beat the market, so judging it against SPIVA misses the point. It converts uncertain future growth into present income, something a passive index cannot do. If you understand that you are capping upside — and accept it — these funds do a real job for income-focused investors, particularly in or near retirement.
Bonds. Fixed income is the strongest structural case for active. Bond indices weight by debt issuance, so the biggest borrowers get the biggest weights — a strange way to lend money. Active managers can steer duration, avoid the worst credits, and exploit new-issue pricing, and the SPIVA picture in bonds is less damning than in equities in several categories. It is no coincidence that AllianceBernstein chose corporate bond funds as its European debut. I cover the category in my active bond ETFs guide.
How I think you should respond
My answer is boring, deliberate, and unchanged by the marketing blitz: core and satellite. Keep a cheap, diversified passive core — a global tracker — as 80–90% of your equity money. Then, if a specific active strategy solves a specific problem for you, use it as a satellite, sized so that being wrong costs little. The full framework is in my core-satellite strategy guide.
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When you evaluate any active launch, judge it on strategy plus cost, never on marketing. Ask four questions. What does this fund do that my index fund does not? What is the total cost, TER plus spread? What must I believe for the manager to overcome that cost? And how will I know, in two years, whether it is working? If you cannot answer all four, you are buying a story, not a strategy.
My take
The active ETF wave is, on balance, good news for European investors — just not for the reason issuers hope. It is dragging active management out of expensive, opaque bank-sold wrappers into cheap, transparent, exchange-traded ones. Fees fall, transparency rises, and bad strategies get exposed faster. I welcome all of that. What I refuse to do is confuse a better wrapper with better odds. Most of these funds will not beat a cheap global tracker over the next decade. My core stays passive. My satellites — an income overlay here, an active bond fund there — must justify their place annually. Yours should too.
Mistakes to avoid
- Buying the launch, not the strategy. New funds arrive with marketing budgets and no track record. Let a fund prove itself, or at least prove you understand its process, before committing.
- Treating “active ETF” as one category. A research-enhanced index hugger and a concentrated thematic fund have almost nothing in common except the label.
- Replacing your passive core. Satellites orbit the core. They do not become it because a factsheet looked exciting.
- Ignoring total cost. New, small active ETFs often trade with wider spreads. Add the spread to the TER before comparing.
- Judging income funds on total return alone, or growth funds on yield. Match the metric to the fund’s actual job.
- Forgetting survivorship. Failed funds get merged away or closed, so the category’s advertised record always looks better than the average investor’s experience.
Key takeaways
- Waystone expects 200+ new active UCITS ETFs in 2026, roughly 50% more than 2025, plus over 20 new issuers entering Europe.
- The boom is driven by the JEPI-style income success, a cheaper and more accessible wrapper, and — candidly — issuer margins.
- “Active” spans three very different families: shy-active index huggers, genuinely active or thematic funds, and income overlays.
- Active ETF fees of roughly 0.2–0.7% beat old mutual funds but still trail passive trackers at roughly 0.03–0.22% (illustrative bands).
- SPIVA evidence is consistent: most active equity funds underperform their benchmark over long horizons.
- The strongest cases for active are income overlays and bonds, where indexing is structurally weaker.
- Respond with core-satellite: keep a cheap passive core, and let any active fund fight for a small, monitored satellite slot.
FAQ
Q: What is an active ETF?
A: An exchange-traded fund where a manager makes investment decisions instead of tracking an index. It combines active management with the ETF wrapper’s low costs, intraday trading and transparency.
Q: How many active ETFs are launching in Europe in 2026?
A: Waystone forecasts more than 200 new active UCITS ETF launches in 2026, about 50% up on 2025, alongside over 20 new issuers entering the European market.
Q: Why is the active ETF wave happening now?
A: Three drivers: the success of JEPI-style income ETFs, a cheaper and more accessible wrapper than mutual funds, and issuers seeking higher margins than passive products offer.
Q: Are active ETFs cheaper than mutual funds?
A: Usually yes. Active UCITS ETFs typically charge around 0.2–0.7%, versus 1.5–2% for many bank-sold active mutual funds including distribution costs. Both figures are illustrative.
Q: Do active ETFs beat passive index funds?
A: Most do not over long horizons. SPIVA scorecards consistently show the majority of active equity funds underperforming their benchmarks, with the failure rate rising over longer periods.
Q: Who is the biggest active ETF provider in Europe?
A: JPMorgan Asset Management, through its Research Enhanced Index and Equity Premium Income ranges. Schroders, Robeco, Goldman Sachs and AllianceBernstein are expanding behind it.
Q: Where does active management make the most sense?
A: Income overlays (covered-call funds doing a job an index cannot) and fixed income, where debt-weighted indices are structurally flawed and active bond managers have a fairer fight.
Q: Should I replace my index funds with active ETFs?
A: No. Keep a cheap, diversified passive core as 80–90% of your equity money, and use active funds only as small satellites that solve a specific problem.
Q: What should I check before buying a new active ETF?
A: What it does that your index fund does not, the total cost including spread, what must be true for it to overcome that cost, and how you will judge success.
Q: Are shy-active or research-enhanced ETFs worth it?
A: They can be a reasonable core substitute if the fee gap over a comparable passive fund is small, because tight tracking error limits how wrong they can go. Judge the fee gap, not the story.
Cited sources: justETF and Morningstar. Check current TER, AUM and holdings on the issuer factsheet — figures change.
European UCITS/ETF investor with 11+ years building a global dividend and index portfolio, and founder of Financial Expert Class. I write every guide here from first-hand experience investing across EU brokers and tax regimes — not theory. More about me →