As mutual funds lose steam, exchange-traded funds (ETFs) continue to gain popularity and proportional share of retail investor assets, according to a study by Cogent Research.

The Cogent report, which is based on a survey of 4,000 investors with at least $100,000 in investable asset, says that 75% of investors owned mutual funds as of October. This is down from 78% a year earlier. In 2006, 94% of investors owned at least one mutual fund.

Meanwhile, the proportion of investors who report owning ETFs has increased from 7% to 11%.

"These numbers reflect a dramatic shift in preference among investors for both mutual funds and ETFs," says John Meunier, a principal at Cogent. "And while it's impossible to know exactly how things will play out, it's clear that a major realignment is under way."

According to Meunier, "traditional mutual fund providers are fighting tooth and nail for a shrinking piece of real estate, while established ETF providers face a different challenge: fending off a rush of new providers in an increasingly crowded marketplace."

Despite the erosion in share, some mutual fund providers remain top-of-mind for investors. Vanguard leads in investor favorability in both mutual funds and ETFs. According to Cogent, half of all investors who know Vanguard have strong positive impressions of the firm as both an ETF (52%) and mutual fund (50%) provider.

Vanguard's strongest competition on the mutual -fund side comes from Riversource (47%), Fidelity Investments (44%) and American Funds (40%). Among ETF providers, iShares (46%), PowerShares (43%), Claymore Guggenheim (43%), Pimco (42%) and Charles Schwab (40%) all resonate favorably with at least four in 10 investors.