There’s a lot of uncertainty right now around growth investing, whether it’s the rate cut back and forth or possible election-related volatility. Perhaps more important, however, is getting the right growth investing exposure as the economy shows its resilience. It’s simple enough to go from a broad market index that holds those big mega-cap tech names and call it a day. That may not be sufficient or specific enough for those looking for a real growth allocation.
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That’s where a strategy like LSGR comes in. Rather than holding more than a hundred names and diluting a growth approach, LSGR looks for just 20 to 30 U.S.-listed firms. The Natixis Loomis Sayles Focused Growth ETF (LSGR ) charges 59 basis points (bps) for its active approach. According to ETF Database data, it has $175 million in AUM.
An Active Growth Investing ETF
The active growth investing ETF, which celebrates its first anniversary in June, focuses on large-cap growth stocks. It uses deep fundamental research to invest in securities with sustainable competitive advantages, and stocks undervalued based on proprietary discount cash flow models.
Alongside those leading tech firms, LSGR holds names like Vertex Pharmaceuticals Inc. (VRTX) and Netflix (NFLX), according to the most recently reported information from Natixis Investments. The strategy has returned 21.6% YTD and 36.6% since inception, per Natixis Investments data.
So, how might investors use an active growth ETF like LSGR in their portfolios? The strategy could make for a worthwhile addendum on top of a core set of holdings. The ETF’s potential for outperformance comes from making significant bets on those core holdings, offset by steadier, often passive holdings. LSGR’s active approach helps it make those moves while operating with greater flexibility than a small, factor-driven passive fund might.
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