FOR IMMEDIATE RELEASE
Wednesday, October 7, 2026
Once listed, Section 351 ETFs perform like other active funds, and 70% have attracted net new money.
Palm Beach Gardens, FL — October 7, 2026 — ExchangiFi today released the Section 351 ETF Seeding and AUM Growth Report, a study of 101 ETFs launched with $25.7 billion of seed capital, drawn from ExchangiFi’s database at ETF Conversion Database.
The study covers SMA-to-ETF conversions seeded with $10 million or more. Smaller launches, included in some databases, were excluded as too small to compare.
Section 351 of the Internal Revenue Code lets investors contribute securities to a new ETF for fund shares.
- New money after launch. 70% of funds have attracted net new money. Net inflows total an estimated $6.3 billion.
- Performance in line with active funds. 67% of funds have trailed their benchmark since listing, consistent with S&P SPIVA data for active large-cap funds.
- Scale on day one. The median fund listed with $118 million, above the level many platforms require for approval.
Low closure rate. Two of 136 Section 351 ETFs (1.5%) have closed or merged since 2019, versus roughly 5% of U.S. active ETFs closing in 2025.
“A Section 351 exchange is a portfolio management tool and, for advisors, an account simplification tool,” said Matt Bucklin, Founder and CEO of ExchangiFi. “Advisors can consolidate client accounts into one ETF, which can lower costs and simplify management. Investors hold a single, transparent fund with daily liquidity. Issuers can launch with scale on day one. Once listed, the fund is an ordinary ETF open to all investors.”
Upcoming launches are listed here: ExchangiFi’s 351 ETF Fund Directory
Read the full report here: Section 351 ETF Seeding and AUM Growth Report