Ron DeLegge

In 2025, Wall Street hit a big milestone: For the first time in history, there were more exchange-traded funds to buy than individual stocks. Multiple industry sources suggest the number of U.S. listed ETFs surpassed the number of publicly traded U.S. companies in late August, when they counted roughly 4,300 ETFs and 4,200 listed stocks. Fast-forward to now. The number of ETFs has soared further, reaching 5,072 as of March 31, according to FactSet.

Direct Indexing (DI) isn’t a one-and-done tax play. While most see it as a transition tool, its power also lies in its enduring investment value. By continuously harvesting tax losses and taking advantage of equity dispersion, DI builds a structural tax edge that keeps delivering long after the initial implementation is over. To dig deeper, we chat with Ken Lassner, CFA, Direct Indexing Lead Product Strategist at Northern Trust Asset Management.

It’s been said “big things come in little packages.” And that’s been surprisingly true in 2026 for exchange-traded funds linked to small company stocks. In an economic landscape littered with land mines—the volatility created by tariffs and the Middle East conflict—ETFs linked to midsize and small caps have handedly outperformed large-cap peers. Since the start of the year, two funds in particular have surged.