Wirehouses Cozying Up to Active ETFs
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Merrill Lynch has plans to triple its roster of active exchange-traded funds available to advisors, FA-IQ's sister publication, Ignites, reported last week. The new additions will include ETF versions of mutual funds that already are on the platform.
The wirehouse's platform already features about 100 active ETFs. Read more here.
Wirehouses simply can't ignore the investor demand for active ETFs, Nathan Geraci, president of The ETF Store, told Ignites.
"Wirehouses have become increasingly comfortable with the ETF wrapper, and issuers are now providing their top portfolio managers and flagship investment strategies via the structure," he said. "The combination of these two trends is serving as a major catalyst for active ETF adoption."
Other industry data point to soaring demand from advisors and their clients. Active ETFs made up 22.4% percent of overall ETF industry sales in the first half of this year, compared with just 16.6% in 2022, according to a BlackRock report cited by the Financial Times, the parent company of FA-IQ. BlackRock has forecasted that the assets in these products will reach $4 trillion by 2030, up from the roughly $900 billion they now hold.
Managers from both the active and passive space have been jumping into the fray to launch new products in this structure.
For example, Allspring Global Investments recently filed to launch six new actively managed ETFs, marking the active manager's first foray into the ETF space, Ignites Managing Editor Caitlin Mollison reported last week. Meanwhile, ETF giant Vanguard is adding to its active roster with plans to launch two actively managed municipal bond ETFs by the end of the year.
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How the ETF Market Has Changed Since 2020
A proliferation of active strategies has transformed the ETF landscape, Tim Coyne, T. Rowe's head of ETFs, tells Ignites Senior Reporter Brian Ponte. Click here or on the image below to watch the video clip.
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