The quest to meet, and create, investor demand in Europe is moving at a frantic, yet sophisticated pace.

In 2026, it might seem impossible to convene nearly 2,000 people from more than 60 countries and find them in unanimous agreement.

Yet, we discovered at least some consensus in the sovereign city-state of Monaco at FundForum: the ETF industry can’t stop talking about active ETFs as agenda item number one. However, it’s not as simple as stopping there. Sub-themes emerged that point to exactly where European ETF growth is coming from and, quite possibly, where it’s headed.

Actives only make up about 3 per cent of the market

As Dan Caps, Investment Manager at Evelyn Partners, pointed out during a panel on the structural challenges facing the industry amid extraordinary growth, while there’s clearly demand, active ETFs account for only about three per cent of the total European ETF market, a figure supported by Morningstar.

When asked if he has a problem with the proliferation of leveraged ETFs, such as the 3x Long SpaceX by Leverage Shares (listed as ELON in the United States and MUSK in Europe), Caps said he doesn’t love them, but if they get people into investing that’s great.

Earlier in the conference day, Yorick Naeff, Head of Innovation at ABN Amro, struck a different chord in a session about the rise of neo-brokers and robo-advisers. “Investors lose money with leverage. Eighty per cent would choose maximum leverage” when given the option, he said.

Therefore, the company he cofounded, Bux, which was acquired by ABN Amro in 2024, shifted focus away from its 2014 roots in CFDs to automated investing with a focus on ETFs.

And that points to one of the primary drivers of ETF growth across Europe.

Alongside Naeff, Timo Slametschka, Head of Partnerships at German neo-broker Scalable Capital, provided a nice, forward-looking survey of the landscape.

Slametschka noted that two-thirds of Scalable’s assets sit in ETFs, as one of Europe’s leading digital platforms in the EU’s top ETF market. He said ETF adoption is strongest among younger investors, who often discover ETFs via online searches. When they search how to invest their money, the top results point to ETFs via set-it-and-forget-it automation, such as Germany’s standout ETF savings plans.

Slametschka argued that active ETFs “won’t be an easy sell” in the mass market. He thinks issuers will need to simplify their messaging and convince retail investors why they should buy active ETFs.

Innovation shot the messenger

Concerns around messaging, specifically investor education, surfaced constantly during the conference.

Andrea Acimovic, Portfolio Strategist with Elston Consulting, speaking during the structural challenges panel, warned that: “Innovation is moving faster than investor education.” Amid the onslaught of new ETF launches, Acimovic said it’s difficult for researchers to keep up and stop investors from “harming themselves,” especially with leveraged products, because they often jump into “whatever’s hot even if they don’t understand it.”

A similar sentiment emerged during a discussion dubbed the active ETF revolution. Vanessa Bonjean, Head of Fund Selection at Société Générale Investment Solutions, noted that younger investors often view ETFs as “cool” and might not even know the difference between passive and active. Bonjean, who works in private banking, said there isn’t much active ETF uptake in the space, but if “we see great success with digital platforms using ETFs as their core,” it will prompt private banking clients to ask about ETFs, a trend she already sees developing.

Ian Crispo, Head of Open Architecture and ETF Solutions with Deutsche Bank’s International Private Bank concurred, “Investor education on active ETFs in private banking is key.”

On the same panel, Sai Tampi, Managing Director and Global Head of Funds, ETFs and Manager Selection at HSBC Global Private Banking & Wealth, tied it all together: “The story matters as much if not more than cost. The question is what client need are you solving?”

None of this means active ETFs won’t continue to grow in Europe.

Caps said we’re already over the hurdle of whether actives will succeed on the continent. But, in a market that—panelist after panelist agreed—is around five years behind the US, but on a similar trajectory, the challenge isn’t launching new products; instead it’s helping investors of all stripes better understand what already exists.

Despite all the talk—and a spoonful or two of hype—around active ETFs, the growth story in Europe remains unmistakably simple. Automated savings plans, intuitive digital platforms and low-cost passive products have done most of the heavy lifting.

The future might lie less in the flavour of the ETF and more in how and why they end up in investor portfolios.

Naeff sees a world where agentic AI helps construct portfolios and implement active strategies on the behalf of investors. At the same time, private bankers and wealth managers are still working to educate themselves and their clients on the myriad ETF products at their disposal.

In addition to active ETFs serving as the heart of industry discourse, the other common thread at FundForum was that innovation isn’t waiting for anyone to catch up. Whether through AI, active ETFs or entirely new structures we have yet to consider, the industry’s ability to educate may ultimately determine whether the present revolution becomes lasting growth.