The advent of the actively managed exchange traded fund (ETF) is a kick in the pants for traditional mutual funds, as the market competition for market share will continue to heat up. PowerShares’ four actively managed ETFs hit the market last week, and the company, calls this "the most significant industry event since its inception 15 years ago."

Jonathon Chevreau for Wealthy Boomer reports that these ETFs are not purely a stock-picker fund, but each ETF uses some form of active management.  For example the Active Mega-Cap (PMA) and Active Low Duration (PLK) use a quantitative model to select certain blue-chip large cap stocks.

Concerns about a diversion from ETF low expenses and transparency has some watching to see what happens.  And the track record that the managers will have with these ETFs means time will tell of the success with these new ETFs.  If anything, they will up the ante for products within the fund industry, and this will give investors plenty of choices.