2025 offers a new set of opportunities for investors, many of whom are refreshing their portfolios. Those investors looking at their investing options, which include a rising class of active ETFs, face a market dominated by just a few names. Finding an active ETF that can navigate that concentration risk and identify firms poised to join the upper echelon can appeal. The dynamic active growth ETF FDG produced strong performance in 2024 and could offer an approach that speaks to that goal.
See more: New Names, Same Compelling Active ETF Strategies
(FDG ), the American Century Focused Dynamic Growth ETF, returned 45.65% over the last one-year period per American Century Investments data. That beat the fund’s benchmark by more than 10% in that time. Charging a 45 basis point fee, the strategy looks for large-cap companies. It prioritizes firms with potential for rapid growth and high profitability.
American Century Leader Lee Speaks to Active Growth ETF FDG's Outlook
The firm’s co-CIO for global growth equity and senior portfolio manager, Keith Lee, spoke to the active growth ETF’s approach. For Lee, the strategy looks to stand out by finding firms disruptive “large addressable markets.”
“FDG is differentiated from the typical large-cap growth fund by its focus on companies in the early and rapid phases of their life cycles,” Lee said. “We underweight stocks of companies that are more mature with limited relative growth potential.”
For Lee, the firm’s aims to find those firms able to “perform and grow” through multiple cycles. The active growth ETF looks to emphasize bottom-up, fundamental research in its approach.
“The strategy holds early-stage growers, and because of its high conviction nature, its exposures can differ meaningfully from the benchmark,” Lee said. “This means that when our stock selection, relatively smaller size and the growth factor are rewarded, FDG has meaningfully outperformed its peers and benchmark.”
FDG in 2025
What role can the active growth ETF play in the year ahead, then? For Lee, interest rates and corporate earnings growth still loom as concerns. Expensive valuations, too, linger as potential risks. Still, he noted, key trends do offer “tremendous opportunity.”
“Long-term trends such as AI evolution and adoption, enterprise digital transformation, cybersecurity, factory automation and drug discovery are examples of meaningful opportunities for shareholders,” he added.
FDG’s active growth ETF approach, looking for firms poised for growth, could benefit from those trends. For those looking to ETF options with fundamental, active approaches, FDG may merit a closer look.
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