It’s a strange time for market watchers when the S&P 500 can hover close to a record while economic news darkens. Yes, a rate cut may be soon to the rescue for many investors and firms, and some spurious growth data came in, but warning signs continue to linger. Consumer confidence is down while inflation continues to persist. Even as the initial wave of tariff pain has subsided, at any moment the federal government could make a big change.
See more: Consider Active Bond ETF TAGG as Fed Signals Cut
So, how should investors navigate such a mixed state of play? Major names in tech remain important contributors for portfolios, but whispers of an AI bubble offer some cause for concern. Meanwhile, other equity segments with that lean more toward value don’t necessarily appeal at first glance.
Instead, it may be worth looking to active investing to break through the darkening sky over the S&P 500. Investors want exposure to the growth obviously happening in the market as the index touches a record. Active investing can find the strongest opportunities even amid uncertainty in both growth and value categories.
In growth, for example, active investing can find firms able to do well even with some headwinds. Whether that entails meeting certain fundamental research metrics or just a standard quality screen, active scrutiny can help to find strong growers even in uncertain times. In value, meanwhile, that same active scrutiny can apply value-oriented standards to find standouts in that space. Active investing can also offer flexibility, which can be key if a market slowdown is in the cards.
Active ETFs like the T. Rowe Price Growth Stock ETF (TGRW) can help get exposure to S&P 500 positivity while checking for that uncertainty. TGRW charges 52 basis points to actively invest in firms that fit certain growth standards. Its managers look for companies with strong cash flow, above-average growth, and earnings momentum stability. Perhaps most crucial, managers look to firms with capacity to expand in unfavorable economic conditions.
Investors can check out more on active investing in the upcoming webcast “Navigating Fixed Income Amid Uncertainty” with T. Rowe Price leaders and VettaFi’s Head of ETF Research Todd Rosenbluth on September 10.
For more news, information, and analysis, visit our Active ETF Content Hub.
