Sick of the market narrative whiplash on everything from inflation to elections? Tired of waiting for rate cuts to happen? One particular active fund, the T. Rowe Price U.S. Equity Research ETF (TSPA ), could really stand out and help investors. Outperforming its benchmark over the one-year, three-year and since inception, the strategy’s use of deep research helps it avoid trend-chasing that can distract other ETF managers.
See more: The Big Question to Ask Before Jumping on Rate Cuts
TSPA recently crossed its three-year exchange traded fund milestone. In that time, its AUM rose significantly, up to $785 million, per VettaFi data. So, what within its strategy merits a closer look?
Per its prospectus, TSPA looks to outperform the S&P 500, weighting overall sectors and industries about the same as the index. Within those sectors, however, it selects individual holdings based on the research by the team of analysts that manage the active ETF. Taken together, matching the S&P 500’s sector weights but then selecting firms within those sectors based on fundamentals can limit how much broad market economic trends impact the ETF while allowing its analysts to identify quality holdings.
Over the last year, the active exchange traded fund has benefited from its strategy. TSPA has returned 27.7%, according to T. Rowe Price data. For comparison, that outperformed its benchmark, which returned 25.6%. Charging only 34 basis points, low for an active strategy, it has also outperformed its ETF Database Category and FactSet Segment averages.
Right now, the active ETF is seeing a strong buy signal per its technical chart data on YCharts. Its price sits above both its 50- and 200-day simple moving averages. For investors looking for a flexible, fundamentals-driven active ETF, TSPA may appeal.
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