The ETF boom that has democratized investing across America is reaching a tipping point. Investors and financial advisers have too many funds to choose from.
Thanks to a breakneck pace of new launches, there are now more than 4,300 exchange-traded funds, a figure that for the first time eclipses the total number of stocks, currently hovering around 4,200, data compiled by Morningstar shows. ETFs account for about a quarter of the total universe of investment vehicles, up from 9% a decade ago, according to Investment Company Institute data.
While that variety drives down costs and tax rates for investors, …