2026 FUSE Forecast and the implications for communicators 

Key Takeaways:

• ETF proliferation accelerates with FUSE projecting record issuance in 2026, with active ETFs and ETF share classes expanding
• Alternative investments democratize and continue to expand in the wealth and 401(k) channels, including through interval and tender-offer funds, bringing private market strategies to retail investors and raising questions about liquidity and stability
• Product wrapper winners (ETFs) and losers (traditional mutual funds) emerge

FUSE Research, the specialized boutique research firm focused on trends in the asset management industry, just released their 2026 Forecast with predictions on product development, distribution and other issues likely to affect asset managers this year. In just five pages, FUSE predicts the continuation of many of the trends reshaping the industry. We highlight five of these and the implications for investment communicators:

More ETFs are coming

FUSE leads with the ongoing proliferation of ETFs including the rise of active ETFs and the rollout of ETF share classes. From a distribution perspective, FUSE predicts wirehouses will be unlikely to support the rollout of these products in 2026 while RIA custodians will.

The implication for ETF sponsors is undoubtedly the challenge of breaking through what is likely to be a crowded and noisy year of record issuance. Defining what makes your launch or product different is a must, and capturing the attention of media and RIA buyers will be a highwire act requiring multiple moves and a well-thought-out strategy to capture attention.

The continued expansion of alternatives

FUSE expects growth of alternatives in the wealth channel and 401(k) channels. It also predicts many traditional asset managers will partner or strike deals to enhance their offerings in this space. Separately but connected to the rise of alts, FUSE expects interval and tender-offer funds to grow. These product wrappers are common for private market strategies like hedge funds, private equity and private credit.

Some point to the democratization of these strategies, bringing investment approaches once deployed mainly by large institutions or the ultra-high net worth to the retail channel. This is a powerful argument that resonates with many advisors, especially considering that the number of public companies has shrunk as many more companies wait or maybe never go public.

This trend is not without challenges with significant media pushback. Acknowledging and addressing that skepticism in your communications is important to building trust. Being forthright with both advisors and clients that these are meant to be long-term holdings and the liquidity risk of these products is important. Contributing to discussions on liquidity, valuation and suitability will help demonstrate your firm’s leadership in the area. Focusing on education – both for advisors and media – is also a must.

Tax Alpha

FUSE points to the growing desire by advisors and clients alike that asset managers offer more proactive guidance on tax strategies and deliver tax savings. Relatedly and listed separately in their report, FUSE points to the growth in direct indexing assets, many of which are designed to deliver significant tax alpha, expecting assets to grow at twice the rate of the overall asset management industry.

The OBBBA passed in 2025 provides significant reasons to communicate about the changing tax landscape and the opportunity to improve after-tax results for clients. There has never been a better time to elevate tax experts, CPAs and the technology that can deliver such tax savings.

ETFs, SMAs and CITs are projected to see the most net new flows

FUSE’s report forecasts net flows by product category with the taxable bond category leading among traditional sectors and mutual funds converted to ETFs continuing. As for the product wrappers, FUSE bets the ETF structure will garner the largest net flows by far at $1.2 trillion with SMAs ($200 billion) and CITs ($154 billion) a distant second and third.

This has communications implications for sponsors of traditional mutual funds which FUSE expects to fall by $700 billion, contracting for a fifth consecutive year. Fund sponsors can point to reason why their products remain relevant and strong. The mutual fund wrapper remains dominant in 401(k) plans where the daily liquidity of ETFs isn’t important. Plus assets have grown overall at many firms given market appreciation. But the industry transition toward the ETF product structure remains a pain point for many traditional asset management firms.

Sales, marketing and data trends

FUSE provides insights on distribution and sales trends given industry concentration and the rise of passive use and emphasizes the need to rely even more on sales analytics. FUSE also suggests that marketers will face pressure to demonstrate their impact on results. Despite predictions that AI will take away jobs, FUSE expects marketing staffing to grow with firms prioritizing channel, product and digital marketing roles in 2026.

AI is likely to improve productivity for marketing and sales teams. But we strongly believe overreliance on AI will generate generic strategies, while true breakthrough strategy and creative can help power marketing and sales results. Never has PR and digital marketing been more measurable and tactically important in driving specialized brand awareness to help asset managers capture advisor and investor attention.

On that note, let us know if we can support your breakthrough sales and marketing strategies in this rapidly changing landscape.