Despite volatility and fears of a recession, the U.S. economy ended on an up note. Data released by the Commerce Department on Thursday showed that U.S. gross domestic product grew by a 2.9% annualized rate over the quarter that ended December 31. While representing a slowdown from 3.2% growth in the previous quarter, this is still above the 2.8% economists surveyed by Dow Jones had expected.
Still, fears of a recession linger. Per CNBC, Andrew Hunter, senior U.S. economist for Capital Economics argued that “the monthly data suggest the economy lost momentum as the fourth quarter went on,” and that he “still expect[s] the lagged impact of the surge in interest rates to push the economy into a mild recession in the first half of this year.”
“Corporate profit reports from the fourth quarter also are signaling a potential earnings recession,” wrote CNBC’s Jeff Cox. “With nearly 20% of the S&P 500 companies reporting, earnings are tracking at a loss of 3%, even with revenue growing 4.1%, according to Refinitiv.”
So, should a recession occur, it may be a good idea to have a steady hand guiding some investments. That’s where active management can come in handy.
While passive strategies lack the flexibility to adapt to changing market environments, active ETFs can offer the potential to outperform benchmarks and indexes. Plus, 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 Todd Rosenbluth, head of research at VettaFi.
As part of its lineup of active exchange traded funds, 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 U.S. Equity Research ETF (TSPA).
T. Rowe Price has been in the investing business for over 80 years through conducting field research firsthand with companies, utilizing risk management, and employing a bevy of experienced portfolio managers carrying an average of 22 years of experience.
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