Archive · 16 Dec 2025
RBC Warns of ETF Market-Maker Capital Constraints
RBC Capital Markets warns that the companies that help trade ETFs (exchange-traded funds) might have too much work if many new ETFs start in 2026.
These companies, called market-makers, have limited money and resources.
The US government recently allowed some companies to offer ETFs as part of mutual funds, which could lead to many new ETFs.
However, there are only a few big market-makers, and they might not be able to handle all the new ETFs.
This could make it harder for smaller ETF companies to start new funds.
RBC Capital Markets warns of potential strain on ETF market-makers due to new listings in 2026.
US regulators may allow ETFs as share classes of mutual funds, potentially leading to hundreds of new listings.
Market-makers have limited capital and resources to trade ETFs intraday and seed new fund launches.
Top 5 market-makers handle over 70% of ETFs, with only 15 market-making firms serving the industry.
Market-makers may prioritize working with larger asset managers, potentially hampering smaller ETF issuers.
- Who
- Valerie Grimba, RBC Capital Markets; ETF market-makers; US regulators; asset managers
- What
- Potential strain on ETF market-makers due to new listings in 2026
- When
- Anticipated new listings in 2026, with approvals starting early next year
- Where
- United States
- Why
- US regulators may allow ETFs as share classes of mutual funds, potentially leading to hundreds of new listings
- Industry Size
- $13 trillion
- Potential New Listings
- 2026
- Regulator
- Securities and Exchange Commission
- Approved Firm
- Dimensional Fund Advisors
- Top Market-Makers
- Jane Street, Virtu, Susquehanna, Citadel, GTS
- Market-Maker Share
- Top 5 handle 70% of ETFs
- Total ETF Issuers
- More than 250
- Total Market-Making Firms
- 15