Over the course of the past year, anyone who tracks the asset management space saw active ETFs on the rise. 2020 saw $80 billion in net inflows, growing 55% and reaching $273.5 billion in assets. Nearly 200 new active ETFs launched globally, marking one of the most significant trends in asset management for the year. Active ETFs have continued to launch into 2021, with Fidelity just recently launching two active bond ETFs in March.
We wanted to track how our asset management coverage set firms have been responding to the trend. Who was launching new active ETFs? When did they launch them? How many of these products incorporated other 2020 trends like active non-transparent ETFs (ANTs) or ESG?
Active ETFs on the rise
We examined the eight firms from our Asset Management Monitor investor and advisor research services that offered active ETFs to find out who launched what from the start of 2020 until now.
As you can see, Fidelity leads the pack in active ETF launches, totaling in nine new products. American Century follows closely seven. Several of our normal coverage set firms did not launch any active ETFs, including those like American Funds and Putnam that do not currently have any ETF offerings. But, both firms have notably filed with the SEC in early 2021 to soon launch their own active ETF lineups and join in the trend.
Tracking other fund trends
The launches are clearly trending upward—and with March yet to end—we may see even more new active ETFs to add to the trajectory. Notably, the spike in December is entirely due to Invesco, which launched five active ETFs in one month: the most launched at once by any of our firms.
ANTs came on the scene in March 2020, when American Century launched the first two offerings of this new product type. Fidelity and Franklin Templeton soon followed suit, and Invesco launched four more later in December 2020. Only these four firms in our coverage set offer ANTs, though the fund type may see more launches after its performance has been proven on the three-year mark.
Currently, ANTs make up nearly half (49%) of the 2020-2021 active ETF offerings in the coverage set. Noticeably fewer firms launched active ESG ETFs, despite ESG’s rising popularity. If you want a more in-depth look at ESG offering by our coverage set firms, be sure to read our April 2020 research report on ESG/SRI resources.
The future of active ETFs
A recent report form ISS Market Intelligence claims $700 billion will flow into active ETFs over the next five years, so this trend isn’t going away any time soon. Active ETFs offer a tax-advantaged, easily tradeable, lower investment minimum alternative to mutual funds, which appeals more to the average day trader. Asset management firms launching these products may be courting the mass affluent audience currently dominated by passive investments.
We’ll continue to keep track of new launches and record how firms promote the products on their websites. If you want to read more about our coverage set’s overall ETF products and how firms present them on their sites, check out the July 2020 research report on ETF offerings. For access, or to learn more about the user experience asset managers provide, explore our Asset Management Monitor investor and advisor research services.