Brazil's ETF market has seen substantial growth, with its financial stock in custody on the B3 exchange nearly doubling from $12.2 billion to $24.2 billion between December 2022 and May 2026. This period also witnessed a surge in investors, from 536,000 to 860,000. The traded volume reached $38.8 billion by May of this year, with approximately 20 million transactions. The number of listed ETFs in Brazil increased significantly, from 125 in May 2025 to 196 in May 2026, marking a 56.80% rise. In comparison, the U.S. boasts over 5,000 ETFs, with 466 launched by mid-May this year alone.
Driving this growth are thematic ETFs, which invest in specific market niches like artificial intelligence, cybersecurity, and critical minerals. While traditional ETFs tracking broad indices such as the S&P 500 have lower annual fees (around 0.03%), thematic ETFs, offering global exposure, typically charge slightly higher administration fees (between 0.50% and 0.70%). Despite these higher fees, they remain more cost-effective than many other investment vehicles. Renato Nobile, CEO and CIO of Buena Vista Capital, predicts that Brazil will eventually mirror the ETF phenomenon seen in the U.S., emphasizing the current record-breaking growth and anticipating its continuation.
BDRs of ETFs also experienced a notable expansion, with the number of listed BDRs rising from 256 in May 2025 to 300 in May 2026. The financial stock of these instruments grew from $888 million to $1.074 billion, and the number of investors quadrupled from 14,300 to 57,100. Flávio Vegas highlights a key difference: local ETFs incur fees for both the Brazilian fund and its reference ETF, whereas BDRs of ETFs only charge the fee of the foreign-listed fund. Both, however, offer similar investment exposure. Eduardo Miquelotti, head of indexed funds and ETFs at BTG Pactual Asset Management, anticipates continued growth in fixed income ETFs, expecting a migration of funds from traditional and individual fixed-income products to listed funds.
