T. Rowe Price entered the exchange-traded fund industry on Wednesday with the debut of four active ETFs listed on the New York Stock Exchange.
The ETFs, which will be actively managed by T. Rowe Price portfolio managers, include the Blue Chip Growth ETF (TCHP), the Dividend Growth ETF (TDVG), the Equity Income ETF (TEQI), and the Growth Stock ETF (TGRW).
T. Rowe Price Head of Exchange-Traded Funds Tim Coyne said today, for the first time, T. Rowe Price is extending its time-tested strategic investing expertise to the ETF industry.
“With new offerings managed by our skilled and experienced portfolio management team, we believe we are entering the ETF marketplace from a position of strength,” Coyne said. “We are excited to be able to serve investors and financial advisors who are interested in tapping into the firm’s investing capabilities through this innovative active ETF model.”
Constructed similarly to flagship investment strategies that have served T. Rowe Price clients well for decades, the active ETFs use the same portfolio managers as their corresponding mutual funds and employ the firm’s long-standing strategic investing approach, characterized by rigorous research, risk awareness, and independent decision making.
T. Rowe Price active ETFs complement the firm’s traditional mutual fund offerings and deliver the key features associated with existing ETFs that some investors may prefer, including continuous daily trading, real-time market determined pricing, and tax efficiency. Over time, T. Rowe Price plans to deliver a robust ETF product lineup covering investments in various asset classes.
“What’s unique here is the caliber of the strategies being launched,” said ETF Trends Director of Research, Dave Nadig. “These strategies are copies of some of the most used, best performing, longest running equity strategies in the T. Rowe Price arsenal. While the track records don’t technically carry over, the funds are being run identically by the same teams that have great Morningstar ratings and broad adoption by individual investors and advisors alike. I suspect they’ll be quite successful at both converting existing fans of these strategies and selling into new markets.”
Here are the four T. Rowe Price active ETFs that launched today:
T. Rowe Price Blue Chip Growth ETF (Ticker: TCHP)
- Seeks to provide long-term capital growth by investing in common stocks of large and medium-sized blue chip companies that have the potential for above-average earnings growth and are well established.
- Managed by Larry Puglia, who maintains a 26-year tenure as portfolio manager of the T. Rowe Price Blue Chip Growth Fund. Mr. Puglia has 30 years of total investment experience, 29 of which have been with T. Rowe Price.
- Net expense ratio is 0.57%.
T. Rowe Price Dividend Growth ETF (Ticker: TDVG)
- Seeks dividend income and long-term capital growth by investing the majority of its assets in the common stocks of dividend-paying companies expected to increase their dividends over time.
- Managed by Thomas Huber, who has 25 years of experience at T. Rowe Price and has been portfolio manager of T. Rowe Price Dividend Growth Fund since 2000.
- Net expense ratio is 0.50%.
T. Rowe Price Equity Income ETF (Ticker: TEQI)
- Seeks high level of dividend income and long-term capital growth by investing most of its assets in common stocks, with an emphasis on large-capitalization stocks that have a strong track record of paying dividends or that are believed to be undervalued.
- Managed by John Linehan, who has served as portfolio manager of T. Rowe Price Equity Income Fund for four years. Mr. Linehan has 30 years of investment experience, 21 at T. Rowe Price, and is the former head of the firm’s U.S. Equity division.
- Net expense ratio is 0.54%.
T. Rowe Price Growth Stock ETF (Ticker: TGRW)
- Seeks long-term capital growth and invests in companies that have one or more of the following: superior growth in earnings and cash flow, ability to sustain earnings momentum even during economic slowdowns, occupation of a lucrative niche in the economy, and ability to expand even during times of slow economic growth.
- Managed by Joseph Fath, who has 19 years of investment experience, 17 at T. Rowe Price. Mr. Fath has been portfolio manager of T. Rowe Price Growth Stock Fund for six years.
- Net expense ratio is 0.52%.
All T. Rowe Price active ETFs feature a proprietary portfolio disclosure process that ensures market makers have enough information to quote prices with a high degree of confidence, while it also protects the intellectual property of the firm’s investment professionals and the interests of its mutual fund shareholders.