Caught on to the active ETF hype? Many investors and advisors are increasingly looking to actively managed ETFs to freshen up their portfolios. ETFs provide all kinds of advantages, but when combined with active investing, they can really stand out.
One particular top-performing active ETF could draw new interest, especially as investors think about tax-loss harvesting toward the end of the year. The fund’s surprising fee, too, could make the T. Rowe Price Growth ETF (TGRT ) one to watch for investors looking to make the move into active ETFs.
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TGRT has returned 43.56% over one year, per YCharts data, on a total return basis. That places the strategy in the upper echelon of actively managed ETFs with more than $300 million in AUM. What’s more, the top-performing active ETF charges just 38 basis points, a relatively small fee for an active fund with that performance.
The ETF, launched last June, has gathered those assets and performance in just over a year. The strategy actively invests in large-cap growth names. It leans on T. Rowe Price’s fundamental research capabilities to enact its bottom-up stock selection approach. TGRT’s managers look for firms believed to have an above-average rate of earnings and cash flow and sustainable earnings momentum.
Such an approach could help the strategy set itself apart in a soft-landing scenario. Its bottom-up stock selection can help it identify new leaders in a tech-dominated marketplace. At the same time, the fund’s active flexibility can help the strategy adapt when the market does change. Even if soft landing predictions don’t exactly prove correct, TGRT can find firms poised to do well.
Active ETFs can provide investors with a whole new set of options. With ETFs offering tax efficiency and flexibility, TGRT’s top-performing active ETF status can help it stand out.
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