The debt ceiling debacle continues. Treasury Secretary Janet Yellen recently warned that the government has until June 5 before it runs out of money. Leaders reached a deal over the weekend to raise the debt ceiling. But congressional Republicans are already vowing to tank the deal.
This could in fact just be more political theater (as some analysts are suggesting). Or the U.S. actually will default on its debt obligations. Either way, investors are in for a rocky road ahead.
While many industry experts also believe that the odds of defaulting are low, the brinkmanship can still rattle markets. This is an environment in which active management can come in handy.
Looking Forward, Not Backward
Active ETFs can be a valuable tool for investors during prolonged periods of market volatility or protracted economic downturns. While passive funds drive by looking in the rearview mirror, active strategies look through the windshield at the road ahead.
However, only a handful of active managers can provide alpha, regardless of market conditions. Active managers with greater resources and greater scope benefit from economies of scale, which can often translate to better returns.
“Active managers have the flexibility to take advantage of market volatility and add to favored positions when prices become more attractive,” said VettaFi’s head of research Todd Rosenbluth.
As part of its lineup of active ETFs, T. Rowe Price offers a suite of actively managed equity ETFs, including the T. Rowe Price Blue Chip Growth ETF (TCHP), the T. Rowe Price Dividend Growth ETF (TDVG), the T. Rowe Price Equity Income ETF (TEQI), the T. Rowe Price Growth Stock ETF (TGRW), and the T. Rowe Price US Equity Research ETF (TSPA).
T. Rowe Price has been in the investment business for over 85 years. The firm conducts field research firsthand with companies, utilizing risk management and employing a team of experienced portfolio managers carrying an average of 16 years of experience.
For more news, information, and analysis, visit the Active ETF Channel.