“They’ve maintained discipline, continuing to work towards savings goals in the face of extreme market volatility,” Powers said. Demand has increased from “all types of investors, but particularly by financial advisers that prefer a low-cost, broadly diversified portfolio with intraday liquidity and tight spreads.”

But Vanguard’s ETF inflows were coupled with outflows from its long-term mutual funds. Driven by withdrawals during the market swoon in March, the funds had more than $20 billion in net redemptions this year through May.

Vanguard structures its ETFs as an arm of its mutual funds, a format it patented. The firm’s ETF lineup may be poised to see another bump in the near future. Vanguard plans to convert some mutual fund holdings to lower-cost ETF shares for clients of its advisory business, spokesman Freddy Martino confirmed.

--With assistance from Dan Reichl.

This article was provided by Bloomberg News.

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