Investors pivot toward actively managed funds as market volatility rises

Global investors are shifting toward actively managed funds over passive strategies in 2025. According to LSEG Lipper, actively managed funds posted a record inflow of $127 billion in the first half, up 57% from a year earlier. At the same time, passively managed funds saw an outflow. 

Passive strategies used to dominate due to low fees and stable returns. Passive funds tend to track large stock indices, such as the S&P 500, without analyzing asset prices or company prospects. But this year, the actions of the US administration sparked significant stock price movements across sectors, allowing active managers to better adapt to market developments. 

A poll by Natixis Investment Managers shows that 71% of strategists anticipate continued high volatility in stock markets, while 68% project similar turbulence to persist in bond markets. At the same time, a majority intends to capitalize on that.