As 2020 comes to a close, the interest of actively managed strategies for investors has remained useful to better navigate uncertain and risky markets. T. Rowe Price’s August launch of several active ETFs has allowed for a few innovative strategies to play into potential success. The T. Rowe Price Growth Stock ETF (TGRW) may have been one of the more fitting funds of the time, given how post-COVID recovery heavily favored growth stocks.
In its attempt to provide long-term capital growth, TGRW Invests in growth stocks with one or more of the following characteristics: strong cash flow and above-average earnings growth; the ability to sustain earnings momentum in economic downturns; and occupation of a niche in the economy and the ability to expand during times of slow economic growth. Additionally, TGRW is able to deliver this actively managed strategy with an expense ratio of only 0.52%.
TGRW favors companies positioned to benefit from powerful secular trends, including those using innovation to disrupt less efficient business models and/or create new ones.
The ETF’s investment approach reflects the T. Rowe Price belief that solid company fundamentals combined with a positive industry outlook will ultimately reward investors with strong investment performance. As with all equity portfolios, TGRW’s share price can fall because of weakness in the broad market, a particular industry, or specific holdings.
Stocks are selected by an experienced portfolio manager with a history of managing growth equities. The process results in a portfolio of 80 to 120 stocks representing T. Rowe Price’s highest-conviction names within the U.S. large-cap growth universe, with some opportunistic exposure to non-U.S. companies through domestically traded ADRs.
The fund is managed by Joseph Fath, CPA, who has 19 years of investment experience, 17 years at T. Rowe Price. Fath has also been portfolio manager of the T. Rowe Price Growth Stock mutual fund for six years.
In addition to TGRW, T. Rowe Price currently offers three other actively managed ETF strategies, which are the T. Rowe Price Dividend Growth ETF (TDVG), T. Rowe Price Equity Income ETF (TEQI), and T. Rowe Price Blue Chip Growth ETF (TCHP).
All four T. Rowe Price active ETFs also feature a proprietary portfolio disclosure process that ensures market makers have enough information to quote prices with a high degree of confidence. At the same time, it also protects the firm’s investment professionals’ intellectual property and the interests of its ETF shareholders.
For more information and strategy related to active ETFs, visit our Active ETF Channel.