New data released Tuesday suggests that consumers have developed a gloomier outlook over the U.S. economy. The Conference Board reported that its consumer confidence index fell to 101.3 in April from 104 in March. The index remains below 2022’s average level of 104.5.
Meanwhile, the board’s expectations index, which is based on consumers’ short-term outlook for income, business, and labor market conditions also dropped, to 68.1 this month from 74 last month. Aside from a brief uptick in December 2022, the expectations index has remained below the level associated with a recession within the next year every month since February 2022.
Ataman Ozyildirim, senior director, economics at the Conference Board, said in a statement that the data shows that consumer “expectations fell and remain below the level which often signals a recession looming in the short-term.”
“Consumers became more pessimistic about the outlook for both business conditions and labor markets,” Ozyildirim added. “Compared to last month, fewer households expect business conditions to improve and more expect worsening of conditions in the next six months.”
With consumer confidence down and more investors expecting a recession on the horizon, it may be a good idea to look into active management.
See more: “Demand for Active ETFs Expected to Grow”
Active ETFs can be a valuable tool for investors seeking alpha during volatile or bear markets. They can enable investors to adjust their portfolio holdings in response to changing market conditions. They can also help investors build a diversified portfolio that’s better suited to their investment goals and risk tolerance, and potentially generate higher returns over the long term than passive ETFs.
It should be noted, however, that not all active managers are created equal, and only a handful 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.
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).
“Active managers can reposition the portfolio toward favored names when they are temporarily trading at lower levels,” said VettaFi’s head of research Todd Rosenbluth.
T. Rowe Price has been in the investing business for over 80 years and conducts field research firsthand with companies, utilizing risk management and employing a team of experienced portfolio managers carrying an average of 22 years of experience.
For more news, information, and analysis, visit the Active ETF Channel.
