Trade war tensions, sinking consumer sentiment, and the unpredictability of U.S. policy reforms weigh heavily on markets moving into the summer months. Advisors and investors looking to put the benefits of active management research and expertise to work within the S&P 500 would do well to consider the T. Rowe Price U.S. Equity Research ETF (TSPA ).
Although the S&P 500 closed out May with its largest monthly gain since the end of 2023, sentiment remains low. U.S. consumer sentiment hovered near all-time lows at the end of May, according to the University of Michigan’s Survey of Consumers. While it remained unchanged between April and May, ending four months of significant declines, sentiment still sits near record lows at 52.2.
“Given that consumers generally expect tariffs to pass through to consumer prices, it is no surprise that trade policy has influenced consumers’ views of the economy,” wrote Joanne Hsu, director of the survey.
The survey occurred before the court rulings and subsequent pause on tariff rollbacks at the end of the month. A boost mid-month on news of China tariff easing was offset by flagging income. News of new trade war tensions with China rattled markets on the final trading day of May, as tariff worries drive ongoing volatility.
Harness S&P 500 Fundamentals With Actively Managed TSPA
In a challenging and uncertain year for equities, active ETFs are worth consideration. Actively managed strategies offer a range of potential benefits for investors and portfolios. Perhaps one of the greatest benefits is that of the expertise active managers bring to the table, and the research they employ when constructing portfolios.
The actively managed TSPA seeks to offer similar characteristics to the S&P 500 Index while potentially generating better returns. Since its inception in 2021 through the end of April, after fees and expenses, TSPA has netted an annualized average return of 9.66% versus the S&P 500’s 8.96%, according to the T. Rowe Price website. The strategy offers similar sector and industry weights as the S&P 500. However, individual security weights may vary.
These individual company weights are determined using research from dedicated T. Rowe Price equity analysts. Each analyst oversees specific stocks that fall within the industry of their expertise. They select the stocks and their weights from within each industry, and the portfolio managers and oversight team determine the overall portfolio composition. The strategy seeks to be sector neutral compared to its benchmark, offering familiar risk and return profiles.
By investing in TSPA, investors can benefit from the fundamental research of an active manager and their team. The fund carries an expense ratio of 0.34%.
For more news, information, and analysis, visit our Active ETF Channel.
