THRO Thematic Rotation ETF Heats Up With Massive Inflows
- iShares U.S. Thematic Rotation Active ETF (THRO) has seen a dramatic reversal
- The fund had inflows of $3.2 billion in a single day recently.
The iShares U.S. Thematic Rotation Active ETF (THRO) is suddenly one of the hottest ETFs of 2025.
After flying under the radar for more than three years, the actively managed fund has exploded in popularity thanks to a massive $3.2 billion single-day inflow in May, followed by steady additions in the days that followed.
Year-to-date, THRO has pulled in $4.3 billion, according to etf.com’s fund flows tool powered by FactSet.
That’s a dramatic reversal of fortune for a fund that had only $15 million in assets under management as recently as February. By mid-May, it had crept up to $600 million. Now, it sits at $4.4 billion and counting.
The size and speed of the inflows strongly suggest a large institutional trade or model portfolio shift. In either case, the flows have put THRO firmly on the map.
THRO Flows—Source: FactSet
What Is THRO?
Launched in December 2021, THRO aims to “dynamically rotate exposure to U.S. market themes ranging from long-term structural forces to rapidly evolving trends,” according to the iShares website. The site says it uses big data and proprietary analytics to identify emerging U.S. themes that could shape the global economy.
Separately, the fund’s prospectus says that it will hold U.S. equity securities that “BlackRock Fund Advisors believes have above-average earnings growth potential.”
The ETF charges an expense ratio of 0.6% and currently holds 220 stocks, according to etf.com's THRO fund report. As of now, its sector breakdown skews heavily toward technology (37%), followed by consumer discretionary (12%), industrials (12%) and health care (11%).
Top holdings include mega-cap names like Nvidia Corp. (NVDA), Apple Inc. (AAPL), Microsoft Corp. (MSFT), Amazon.com Inc. (AMZN), Meta Platforms Inc. (META), Boston Scientific Corp. (BSX) and Costco Wholesale Corp. (COST).
THRO Top Holdings—Source: FactSet
So Far, So Good
Despite its active approach, THRO has largely tracked major benchmarks like the Invesco QQQ Trust (QQQ) and the SPDR S&P 500 ETF Trust (SPY) in terms of performance.
- 1-Year Return: +15.6% vs. +16.7% for QQQ and +13.9% for SPY
- Since Inception (Dec 2021): +40.9% vs. +38.6% for QQQ and +34.9% for SPY
What’s notable is that THRO has delivered these returns with slightly smaller drawdowns:
- 2025 YTD Drawdown (as of April lows): –14.6% vs. –18.5% for QQQ and –15.0% for SPY
- 2022 Max Drawdown: –25.9% vs. –32.5% for QQQ and –23.9% for SPY
Looking Ahead
Whether THRO’s recent surge in popularity is a flash in the pan or the beginning of a long-term trend remains to be seen. The fund’s performance has been solid so far, and the ability to outperform QQQ with somewhat lower volatility is impressive.
But with a relatively high fee and limited track record, investors will want to watch closely to see if the fund’s thematic rotation approach continues to deliver.
