The active ETF TCAF has crested $1 billion in AUM in just nine months. Emblematic of a strong year for active ETF investing, the T. Rowe Price Capital Appreciation ETF (TCAF) added nearly $500 million in flows over the last three months alone. Managed by star operator David Giroux, the ETF has also performed well alongside its fast-paced AUM growth. To what, then, should market watchers attribute its rapid gathering of assets?
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TCAF seeks high-quality U.S. large-cap stocks. Doing so takes an active fundamental research approach, seeking out firms with leading market positions. Typically holding about 100 firms, its overarching goal is capital appreciation, incorporating both growth and value approaches.
That has led the strategy to include some, but not all, of the so-called “Magnificent Seven” in its top holdings. Key firms like Microsoft (MSFT) lead, but Tesla (TSLA) misses out. It holds firms like Canadian Natural Resources LTD (CNQ) as part of its otherwise tech-heavy portfolio.
The active ETF’s approach has helped it return 12% over the last three months. That return comes in higher than its ETF Database Category and Factset Segment averages. So, going forward, what role can it play for investors?
Market watchers looking for an active strategy, of course, stand out as a leading option. Its long-term capital appreciation view can make it an appealing dip into the core U.S. equity space. Its flexibility across growth and value in the key U.S. equities world, too, may intrigue, backed by Giroux’s experience. With the strategy passing $1 billion in AUM so quickly, investors seem to be taking notice.
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