Active ETFs are not a separate asset class. They are a way of accessing investment strategies. Our research suggests investors are increasingly focused not on whether active ETFs have a role in portfolios, but on what role they can perform.
Investors often ask where active ETFs fit within a portfolio. The answer depends less on the ETF structure itself and more on the role the allocation is intended to perform.
An active ETF is not a separate asset class, but it is a way of accessing an investment strategy. The active manager determines what the portfolio owns and how it responds to changing risks and opportunities. The ETF structure determines how investors access, trade and hold that strategy.
The flexibility of the structure means investors can use ETFs strategically for core equity and fixed income exposure, or tactically to express views on themes, sectors or duration. As investors focus not only on what to own but also on how to implement their views, active ETFs are becoming more relevant to portfolio construction.
Our latest Schroders Global Investor Insights Survey (GIIS), based on responses from 1,025 investors globally, found that only 6% see no role for active ETFs in their portfolios. The question is therefore shifting from whether active ETFs have a role to where they might fit.
The survey findings suggest investors are using active ETFs to fulfil a range of portfolio objectives. The common theme is not the ETF itself, but the role the allocation is intended to play.
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