ETFdb Logo
ETFdb Logo
  • ETF Database
  • Channels
    • Active ETF
    • Alternatives
    • Beyond Basic Beta
    • China Insights
    • Climate Insights
    • Commodities
    • Core Strategies
    • Crypto
    • Disruptive Technology
    • Dividend
    • Dual Impact
    • Emerging Markets
    • Energy Infrastructure
    • ESG
    • ETF Building Blocks
    • ETF Education
    • ETF Strategist
    • Fixed Income
    • Free Cash Flow
    • Future ETFs
    • Global Diversification
    • Gold/Silver/Critical Minerals
    • Innovative ETFs
    • Institutional Income Strategies
    • Leveraged & Inverse
    • Managed Futures
    • Market Insights
    • Megatrends
    • Modern Alpha
    • Multi-Asset
    • Night Effect
    • Portfolio Strategies
    • Retirement Income
    • Richard Bernstein Advisors
    • Tax Efficient Income
    • Thematic Investing
    • Volatility Resource
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Sector Tracker Tool
    • ETF Database Categories
    • Head-To-Head ETF Comparison Tool
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
    • Indexes
    • Mutual Fund To ETF Converter
    • ETF Data for Journalists
    • ETF Nerds
  • Research
    • First Bitcoin ETF
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Index Education
    • Index Insights
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Multimedia
    • ETF 360 Video Series
    • ETF Trends on Videos
    • ETF Trends on Podcasts
    • ETF Prime Podcast
  • Company
    • About VettaFi
    • Get VettaFi’ed
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Active ETF Channel
  2. Dave Nadig Talks Active’s Popularity on Yahoo Finance
Active ETF Channel
Share

Dave Nadig Talks Active’s Popularity on Yahoo Finance

James ComtoisMar 01, 2023
2023-03-01

While ETFs have historically been an index-only business, more investors are pouring their money into active ETFs so far this year than they did in 2022. After actively managed exchange traded funds brought in 14% of investor flows into ETFs in 2022 (a record), “we’re looking at close to 40% of the flows” going into ETFs so far this year are heading into active funds, according to VettaFi financial futurist Dave Nadig.

“It’s only really been in the last year and a half or so that we’ve seen any real interest in active ETFs,” @Vetta_Fi's @DaveNadig says, adding: “Clearly this is a story of investors slowly coming to this realization that active [ETFs] may have a place in their portfolio.” pic.twitter.com/qLSYxoRZRc

— Yahoo Finance (@YahooFinance) March 1, 2023

“It’s really only been in the last year and a half or so that we’ve seen any real interest in active ETFs,” Nadig said while appearing on Yahoo Finance. “Clearly, this is a story of investors slowly coming to this realization that active may have a place in their portfolio.”

Nadig explained some of the reasons for active’s rise in popularity. For one thing, “we just had a big down market.” In a down market, two things happen: investors lose their confidence, and take advantage of tax-loss harvesting opportunities.

“People lose their conviction a little bit. They may have been in an index strategy they just saw themselves take a haircut, maybe now they want somebody minding the store,” he said. “The other big thing is we just went through a big tax-loss harvesting season. A lot of folks who were in underperforming funds… took the opportunity to sell and book the loss.”

As these investors return to the market in 2023, in the equity space, Nadig said he is seeing an increased interest in “finding individual portfolio managers or teams of portfolio managers to run that money.”

“Whether or not it’s going to work, you never know,” he added.

“Traditional Stock-Picking Active Managers”

In terms of the actively managed ETFs that are attracting the most amount of money, Nadig said that “they’re actually fairly traditional stock-picking active managers.” He highlighted the Capital Group Growth ETF (CGGR A-) as one active fund that’s gaining a lot of investor attention.

CGGR has been beating its benchmark (the S&P 500) “by about 4% or 5% so far this year.” As a result, the Capital Group fund has pulled in a couple hundred million dollars while a complex of S&P 500 index ETFs have seen $10 billion in outflows in just eight weeks.

“So, clearly that’s a real reallocation we’re seeing,” Nadig said.


Content continues below advertisement

“What Could I Have Done Better?”

When asked about what a prolonged interest rate hike cycle from the Federal Reserve could mean, Nadig said that it “lends itself to people questioning their allocations.” They ask themselves, “’What could I have done better?’”

“If rates are now going to be 50 or 75 bps… finding a seasoned portfolio management team at least may make you sleep better at night.”

VettaFi’s financial futurist did acknowledge that active management’s track record “is not actually that great,” noting that “only about 45% of active managers managed to beat their benchmarks last year.”

“And that was a great year,” Nadig added.

For more news, information, and analysis, visit our Active ETF Channel.

Loading Articles...
Help & Info
  • Contact Us
Tools
  • ETF Screener
  • ETF Analyzer
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Performance Visualizer
  • ETF Database Model Portfolios
  • ETF Database Realtime Ratings
  • ETF Database Pro
More Tools
  • ETF Launch Center
  • Financial Advisor & RIA Center
  • ETF Database RSS Feed
Explore ETFs
  • ETF News
  • ETF Picks of the Month
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Best ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Legal
  • Terms of Use and Privacy Policy
  • © 2023 VettaFi LLC. All rights reserved.
Follow ETF Database
Follow ETF Database

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X