Taiwan’s exchange-traded fund market has experienced remarkable growth, with ETF assets increasing by an impressive 25.6-fold over the past decade, outpacing the global average of 4.6 times by a significant margin.
The Taiwan Stock Exchange (TWSE), recognised as ETF Exchange of the Year in Asia Pacific at Asia Asset Management’s 2026 ETF Awards, attributes this exceptional performance primarily to the market’s fully developed ETF ecosystem and strong retail investor participation.
In an interview with AAM, Christine Cho, senior vice president of TWSE, highlights that Taiwan’s ETF market has significantly outperformed global averages in both the growth rates of asset size and number of listed products.
Retail participation
“Taiwan’s ETF market features exceptionally high retail participation, with strong engagement from the younger generation,” she says, adding that the exchange actively promotes ETFs as an inclusive and accessible investment tool.
TWSE figures show that securities accounts held by investors aged 20 to 30 increased from 47% in 2022 to 60% as of end-2025. Retail market penetration has reached remarkable levels, with ETF beneficiaries exceeding 15 million in a population of 23 million, Cho says.
“This dynamic growth is underpinned by a high-efficiency environment where each ETF is supported by at least one liquidity provider [average of five liquidity providers for each ETF], effectively facilitating a market where retail investors now account for over half of total trading volume,” she notes.
Over the past few years, TWSE actively supported ETF issuers and expanded investor engagement through promotional events, ETF investment expos and collaboration with media partners to educate individuals about ETFs.
Completed ETF ecosystem
At the end of 2025, Taiwan was the third largest ETF market in Asia after China and Japan. Cho says that Taiwan thrives on a robust ecosystem, where TWSE, regulators, and industry players collaborate closely to drive growth and cement Taiwan’s leadership in the Asia-Pacific region.
Under the government’s Asian Asset Management Center (AAMC) initiative, market momentum had further accelerated, fuelled by newly implemented policies that led to significant asset growth for local ETF issuers in 2025. This underscored the market’s strong international and domestic appeal, attracting four foreign issuers to join Taiwan’s ETF market during the year.
“These milestones had been prominently showcased through the inaugural Taiwan Weeks, which promoted discussions between domestic and international issuers, effectively amplifying Taiwan’s regional influence in the ETF sector,” says Cho.
In line with the government’s AAMC objectives of product diversification and talent cultivation, Taiwan’s ETF market has seen the launch of various innovative products, further enriching the market landscape.
Fifteen active ETFs worth US$5.3 billion were listed last year after the government granted regulatory approval for active and multi-asset ETFs in 2024. Cho says the regulatory easing resulted in “a rapid influx of new products”, further fuelling market growth.
Expanding international reach
TWSE is actively expanding its international reach to facilitate the growth. In September 2025, three cross-border ETFs between Taiwan and Japan were launched. Additionally, three Taiwanese ETFs’ depository receipts were set up in Thailand since November 2024. Cho says that these linkages “underscore the collective commitment of the exchange, issuers, and regulators to global integration”.
TWSE and its index subsidiary, Taiwan Index Plus Company, are actively working to promote thematic ETFs across a broad range of industries – including traditional semiconductors, electric vehicles, green energy, artificial intelligence, robotics, and drones – to align with the industries and to meet investors’ diverse needs.
“We have collaborated to promote new environmental, social and governance-related products in support of the global shift towards green investments,” Cho says.
In January 2026, TWSE launched the Taiwan Pristine Index, which selects nearly 60% of its constituent companies from those ranked within the top 50% or above in ESG evaluations. Cho says this move underscores the exchange’s commitment to supporting ESG principles.
TWSE is also promoting the retail participation by dollar cost averaging (DCA). Total DCA contributions in 2025 reached NT$202.99 billion (US$6.44 billion), representing a 24.9% year-on-year increase. Monthly DCA accounts reached 1.32 million in December 2025, compared to 1.02 million in December 2024 – an increase of nearly 30%. This growth reflects increasing retail participation, larger capital allocations, and a shift towards more stable and long-term investment behavior.
To further promote ETF, TWSE is also promoting the inclusion of ETFs within the Taiwan Individual Savings Account (TISA) framework, an official scheme designed to encourage citizens to engage in long-term financial planning for retirement.
“We continue to prioritise financial inclusion by promoting a broader range of innovative products, such as ETF of ETFs, actively managed multi-asset ETFs, and covered-call ETFs,” Cho says. “These efforts not only enable asset managers to develop more comprehensive product portfolios and enhance their international competitiveness, but also contribute to creating a more inclusive and accessible investment environment.”
She says that the exchange maintains close and ongoing engagement with industry stakeholders through policy dialogues and market feedback mechanisms to ensure that regulatory designs align with practical needs.
For example, participants from industry, government and academia discussed topics such as ETF innovation, regulatory optimisation and market development during the Taiwan Weeks in 2025.
Besides other main issues, this event showcased the depth and vibrancy of Taiwan’s financial ecosystem, help build consensus and further support the stable development of the ETF industry, Cho says.
