Assets held in domestic exchange-traded funds reached a record $995 billion at Dec. 31.
Net inflows exceeded $100 billion for the fourth consecutive year, according to a report from State Street Global Advisors.
Emerging markets and fixed-income investments were the fastest-growing categories.
Tom Anderson, the global head of ETF strategy and research at State Street Global Advisors, predicted that investors would use ETFs to buy high-dividend stocks and generate steady income.