2025 is more than halfway through, with plenty of ups and downs already in the rearview mirror. The path ahead may not be smooth, however, despite the late spring recovery from early turbulence. Together, tariffs, geopolitics, and persistent inflation could make for a bumpy road ahead. With many investors holding significant weights to growthier stocks, shifting into active growth ETFs, for example, could help.
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Why shift to active? An active approach gets more out of the fundamental upside-seeking approach within many growth funds. By digging into fundamental research, an actively managed growth ETF could outperform passive rivals. What’s more, should turbulence return this year, active management can adjust — or help managers hold certain stocks for longer, rather than see them drop out of an index too soon.
The American Century Focused Dynamic Growth ETF (FDG ) presents a strong example therein. The fund charges a 45 basis point fee for its approach. The quality growth ETF actively invests in large- and midcap U.S. firms that have rapid growth potential. While that of course includes an allocation to popular megacap tech names, the fund has other contenders as well.
For example, FDG includes the likes of Alnylam Pharmaceuticals, Inc. (ALNY) and Rocket Lab USA, Inc. (RKLB). ALNY’s RNA interface work has helped it rise almost 40% YTD, per YCharts. RKLB, meanwhile, with its focus on rockets and spacecraft, has produced a robust 89% return in the same time frame.
That has helped FDG return 27.25% over the last three months, according to ETF Database data. That outperformed both the fund’s ETF Database Category and FactSet Segment averages in that time frame. The high-conviction fund’s price also sits well above both its 200- and 50-day simple moving averages. That may indicate a degree of healthy upward momentum that can appeal.
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