With the first half of 2024 in the books, investors have the opportunity to look back on the year so far for takeaways. The growing role active ETFs are playing in the ETF universe presents one such lesson, with the active growth ETF FDG a standout to start the year. The strategy has far outpaced the return of the SPDR S&P 500 ETF Trust (SPY) in that time per YCharts, speaking to the growing status of active strategies.
See more: What Advisors Told VettaFi in First Half
Per YCharts, FDG, the American Century Focused Dynamic Growth ETF, has returned 26.8% over the last six months. That almost, but not quite, doubles SPY’s return in that time of just 15.5%. What’s more, it reflects a solid period of overall outperformance for the active growth ETF. FDG has also outperformed SPY over one year, with FDG’s 37.5% return in that time outdoing SPY’s 24.8%.
FDG’s Active Growth ETF Approach
Why, then, might FDG be performing so well, and what role could it play for investors for the remainder of the year? The strategy looks for large and mid cap U.S. firms with potential for rapid growth as well as appealing profits. Charging 45 basis points (bps), the ETF has reached $235 million in AUM since launching in 2020. What’s more, the ETF’s price has risen above both its 50-day and 200-day Simple Moving Averages (SMAs) indicating strong momentum.
So, what role might the strategy play in investor portfolios? An active ETF like FDG could provide a helpful addition to a core portfolio as a growthier option. Its active flexibility could help it given headwinds like a higher for longer rate regime and concentration risk in the stock market. Taken together, the active growth ETF stands out in both the active and ETF spaces and may be worth a closer look for investors in the second half.
Active growth ETF FDG has outperformed SPY over the last six months per YCharts.
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