The debt ceiling fight finally appears to be impacting markets — just not in the way many have expected. Markets actually gained on Thursday as investors felt bullish on negotiations. In fact, the S&P 500 closed on its highest point since August.
And industry insiders are indeed optimistic. KKM Financial’s CEO Jeff Kilburg told CNBC that investors have been able to “look through” the debt ceiling negotiations drama.
“I have optimism on the market, but also optimism that we’re going to find a way to move forward. The U.S. government’s never truly going to walk away from their default,” Kilburg added.
Treasury Secretary Janet Yellen has said that the government could be unable to pay its bills as soon as June 1. House Speaker Kevin McCarthy and President Joe Biden have expressed optimism about reaching a deal in time to avoid a default.
Even if the debt ceiling fight is just, as Kilburg characterized, “a lot of noise,” that noise can still impact markets. This is why investors want a steady hand guiding their investments. That’s where active management can help.
See more: “How the Debt Ceiling Fight Could Roil Markets”
Active Management: A Valuable Tool For Investors
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.