Actively Managed ETFs Surpass $1 Trillion Amid Market Turbulence

Milestone in Active ETFs

• 📈 Actively managed ETF assets have reached a significant milestone, surpassing $1 trillion, now representing about 10% of all ETF assets.
• 💡 This growth is attributed to the combination of active management benefits with the structural advantages of ETFs, offering lower costs and greater tax efficiency.

Market Turbulence and Active Management's Role

• ⚠️ The current market environment, characterized by volatility and uncertainty in both equity and fixed income markets, is proving beneficial for active management flows.
• 🎯 Active ETFs saw 30% of ETF volume year-to-date, highlighting their appeal in a non-persistently rising market.
• ⚡ Active managers can differentiate portfolios by identifying income opportunities, managing risk through derivatives, or focusing on specific stock-picking strategies.

T. Rowe Price's Active ETF Strategies

• 🧠 T. Rowe Price, a major active manager, offers strategies like the Capital Appreciation ETF and the Equity Research ETF.
• 🎯 The Capital Appreciation ETF aims to outperform the S&P 500 with lower volatility and greater tax efficiency, holding around 100 high-conviction stocks identified through rigorous fundamental research.
• 🚀 The Equity Research ETF is a large-cap growth product with lower tracking to the index, managed by North American directors of research, allowing for overweighting or underweighting of securities based on fundamental analysis.
• 🏆 The Capital Appreciation fund is managed by David Drew, a two-time Morningstar Manager of the Year, showcasing the firm's deep investment talent.

Differentiating Active Management Approaches

• 🧩 It's important to distinguish between different types of active management; while some focus on broad strategies like value screens or small-cap overlays, others, like T. Rowe Price, emphasize deep fundamental research and high-conviction stock selection.
• 📊 The firm leverages its extensive global investment professionals and research analysts to drive its active strategies, offering clients exposure through the ETF structure.