Brendan McCarthy, Global Head of ETF Distribution for Goldman Sachs Asset Management, joined Zoe Hunt, Host of RIA Channel, to discuss the continued growth of active ETFs and the next stage of the ETF industry evolution.
As demand for ETFs continues to increase, McCarthy points to the ongoing rise of active ETFs and increasing adoption among both retail and institutional investors in the U.S. and globally. He highlights fixed income and derivative income as two key areas of this growth. McCarthy explains that active management can help investors navigate liquidity fragmentation, security selection, and sector allocations within fixed income. He adds that derivative income products have experienced significant growth as more products come to market and investors find new uses within client portfolios.
McCarthy also expects greater product proliferation and more use cases for active ETFs as investors seek more precision in portfolio construction and tools to manage risk. He highlights growing interest in outcome-oriented exposures, including defined outcome ETFs and buffered strategies, which can provide investors with a greater understanding of how portfolios may behave amid market uncertainty.
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