Active ETFs have had a strong 2024 overall, with some key strategies and investing styles worth revisiting. The active ETF channel’s top stories showed a few standout trends in particular that can help investors reflect on the year overall. With 2025 offering opportunity but also uncertainty, they also provide some insights about how to invest with active ETFs to adjust in the new year.
The Nontech Stocks Boosting Active ETF TCAF
The third-most-read piece focused on the T. Rowe Price Capital Appreciation Equity ETF (TCAF). The strategy, which launched in June last year, charges 31 basis points (bps) to actively invest. Its manager, David Giroux, seeks out high-quality U.S. large-cap stocks based on factors like experienced management, market position, and attractive valuation.
The story explored how TCAF has benefited from investing in areas outside of tech. In a strong year for tech firms that have also presented concentration risk, the active ETF’s flexibility and focus on fundamentals have helped it offer an alternative. The fund does hold both tech and non-tech names, but it’s done through a “quality first” lens. This thoughtful research-driven approach may help to explain TCAF’s sizable investor interest, recently eclipsing $3 billion AUM.
Eye Active Bond ETF TAGG for Duration Push
The second-most-read story took a closer look at the benefits of an active approach to fixed income. Starting off the year, the piece arrived as investors settled in for the long wait for rate cuts with questions about duration. TAGG, the T. Rowe Price QM U.S. Bond ETF, offered an opportunity.
Hitting its three-year ETF milestone in September, the active ETF provided a fixed income option with an active approach for just eight bps. Its flexibility helps TAGG navigate a complicated fixed income landscape overall, with active investing’s ability to closely scrutinize bond credit quality a big plus. That may have drawn significant attention in a year in which fixed income roared back to life.
How Active Dividend Growth ETF TDVG Stands Out From the Crowd
Finally, the top story for the year intriguingly focused on current income via active dividend growth ETF TDVG. TDVG, the T. Rowe Price Dividend Growth ETF, charges 50 bps to invest companies with above-average dividend and earnings growth. Scrutinizing firms for competitive dividend yields, sound balance sheets, growth potential, and more, the fund’s approach drew significant readership.
By leaning on both T. Rowe Price’s fundamental research capabilities and dividend data, the strategy looks for firms with healthy overall outlooks and upside. That could make it a worthwhile add as core or satellite holding in the new year as uncertainty continues.
2024 provided active ETFs with a platform to grow and make their mark on the ETF ecosystem. 2025, in turn, could see active ETFs take yet another leap forward and solidify their status as key investment tools. The likes of TDVG, TCAF, and TAGG, after positive 2024 performances, could be in line to play a major role in that next chapter.
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