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January 23, 2015 at 11:27 AM
After years of relative calm, the VIX volatility index has been spiking above 20, a high reading, numerous times in the past few months.
Exactly what that signals remains unclear — though it is this very heightened uncertainty that often drives investors into the hands of professionals as opposed to passive market-linked indexes without a driver at the wheel.
Investors in ETFs — historically a domain dominated by passive investing vehicles — may therefore appreciate that there are more opportunities than ever for an actively managed approach, if they value the combination of ETFs’ flexible structure with a manager’s guidance.
That is one conclusion that jumps off the pages of a nifty year-end guide to active ETFs, produced by AdvisorShares. The actively managed ETF family is displaying its wares at ETF.com’s InsideETFs conference beginning Sunday.
And while the firm does not dominate the active space in terms of assets under management, it does run the largest number of individual funds, many of them in the alternative investing space — an area of interest to those looking for creative hedges.
Its Active ETF Report reflects significant growth in actively managed funds in the past year, with16.5% growth in AUM from $2.4 billion to $17.27 billion. The fund count expanded from 73 to now 125 active ETFs.
The news was not all rosy. Two active ETFs closed last year — Guggenheim Enhanced Bond (GIY) and Pimco Build America Bond Strategy (BABZ).
But 54 new funds were launched, including WBI Shares, whose 10 ETFs raised over $1.15 billion in assets, reflecting surging demand for tactical funds appealing to investors hoping to reduce portfolio volatility. The upstart firm now has 6.7% of active ETF market share.
