Group 1: Industry Consolidation - The industry is expected to see consolidation, highlighted by Goldman Sachs' acquisition of Innovator ETFs, with over 400 unique ETF brands and 4,000 products in the market [1] - Raymond James' acquisition of Clark Capital Management Group indicates a trend, with expectations of three to five meaningful deals in the current year [2] Group 2: Smart Beta ETFs - Predictions suggest inflows for smart beta ETFs will double from $37 billion to $75 billion, with the Invesco S&P 500 Equal Weight ETF (RSP) being the fourth-largest fund by flows this year [3] - The record for smart beta inflows was set at $103 billion in 2022 [3] Group 3: Crypto Index ETFs - Skepticism exists regarding the prediction that crypto index ETFs will triple assets from $1.7 billion to $5 billion, as year-to-date flows have primarily gone to bitcoin and ethereum funds [4] - A survey indicated that 42% of advisors prefer crypto index ETFs over individual tokens [4] Group 4: International Equity and Fixed Income ETFs - Predictions on international equity and fixed income ETFs breaking records are endorsed, with bond ETFs capturing 32% of total flows this year, up from 29% last year [5] - Flows are shifting from short duration to the belly of the curve, approximately six years duration [5] Group 5: Active ETFs - Active ETFs experienced record inflows of $580 billion in 2025, contrasting with active mutual funds that had $640 billion in outflows [6]

Core Insights - Fixed income ETFs had a record-breaking year in 2025, with inflows rising 45% to $437 billion from $300 billion in 2024, driven by macroeconomic uncertainties and falling interest rates [3][2] - Morningstar predicts that fixed income ETFs will continue to gain market share, potentially reaching 33% of the bond fund market by the end of 2026, as they have been gaining an average of 2% market share per year since November 2015 [4][5] - The demand for short-term bond ETFs is expected to increase as they offer competitive yields compared to traditional money market accounts, appealing to investors seeking better returns on cash [6][7] Market Trends - In 2025, nearly 150 new fixed income ETF products were launched, indicating a growing interest in active management within the fixed income space [2] - Broad-based fixed income ETFs, such as the iShares Core U.S. Aggregate Bond ETF (AGG) and the Vanguard Total Bond Market ETF (BND), attracted significant inflows, with $177 billion reported [8] - Active ETFs are gaining traction, with funds like the Eaton Vance Total Return Bond ETF (EVTR), JPMorgan Income ETF (JPIE), and PIMCO Multisector Bond Active ETF (PYLD) being highlighted for their potential to outperform traditional indices [9] Future Outlook - The fixed income ETF market is expected to remain dynamic in 2026, with continued investor interest in both broad-based and actively managed funds [10] - The current low-interest-rate environment from banks is likely to drive more investors towards short-term bond ETFs as a means of earning higher yields [7]

Financial Data and Key Metrics Changes - BlackRock reported full-year revenue of $24 billion, up 19% year-over-year, with operating income of $9.6 billion, an 18% increase, and earnings per share (EPS) of $48.09, which increased by 10% [7][8] - Fourth-quarter revenue reached $7 billion, a 23% increase year-over-year, driven by acquisitions and organic base fee growth [7][8] - The company achieved nearly $700 billion in net new assets for the year, with a 9% organic base fee growth and a 16% technology annual contract value (ACV) expansion [3][4] Business Line Data and Key Metrics Changes - The fourth-quarter base fees and securities lending revenue totaled $5.3 billion, up 19% year-over-year, supported by market beta impacts and organic growth [9] - Performance fees for the fourth quarter were $754 million, reflecting higher revenue from alternatives [10] - Technology services and subscription revenue increased by 24% year-over-year, with ACV growing 31% [10] Market Data and Key Metrics Changes - iShares led the industry with $527 billion in net inflows for 2025, representing 12% organic asset growth [13] - Retail net inflows for the year were $107 billion, significantly boosted by a $80 billion SMA assignment from Citi Wealth [14] - Institutional active franchise generated net inflows of $54 billion, while institutional index net outflows were $119 billion, primarily from low-fee index equity strategies [14] Company Strategy and Development Direction - BlackRock is focusing on building leading franchises in high-growth markets such as private markets, digital assets, and active ETFs, targeting $500 million revenue generators in the next five years [6] - The company aims to raise $400 billion in private markets by 2030, leveraging its strong client relationships and investment performance [19] - BlackRock is integrating public and private markets through technology and data, positioning itself as a leader in the evolving asset management model [6][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's growth trajectory, with expectations of continued organic base fee growth of 6% or higher [5][33] - The company anticipates a favorable operating environment, with a focus on delivering better outcomes for clients and enhancing shareholder value [31] - Management highlighted the importance of adapting to market changes and leveraging technology to drive future growth [30][56] Other Important Information - BlackRock returned a record $5 billion to shareholders in 2025 through dividends and share repurchases, with a 10% increase in the dividend per share planned for 2026 [12][13] - The company is targeting a mid-single-digit percentage increase in general and administrative expenses for 2026, while maintaining a flat headcount [12][52] Q&A Session Summary Question: What is the outlook for net flow pipeline and the money market business? - Management noted that organic base fee growth continues to outperform expectations, with a strong pipeline in private markets and systematic strategies [32][33] - Regarding the money market business, they expect flows to be affected by rate cuts, but anticipate opportunities in intermediate-term bonds [34][35] Question: How is BlackRock prioritizing growth in Asia? - Management highlighted the rapid growth of capital markets in Asia, particularly in Japan and India, and emphasized the potential for self-directed retirement platforms [40][41] Question: How does BlackRock differentiate in the insurance channel? - The company is the largest insurance company general account manager, focusing on delivering customized solutions and integrating public and private portfolios [43][44]

Core Insights - The article emphasizes the importance of tax-exempt municipal bonds (munis) in investment portfolios, particularly for investors seeking capital appreciation or current income, especially those nearing retirement [1]. Group 1: Tax-Exempt ETF Overview - The T. Rowe Price Intermediate Municipal Income ETF (TAXE) offers an active management approach with a low fee of 24 basis points, launched in 2024, focusing on a range of credit qualities in intermediate maturity debt securities [2]. - The active strategy evaluates issuers based on metrics such as prices and yields, including considerations for junk bonds, resulting in a year-to-date return of 5.8% as of November 30, with a yield to maturity of 3.9% and a 30-day SEC Standardized Yield of 3.16% [3]. Group 2: Portfolio Integration - TAXE can serve as a strong fixed income addition to portfolios, helping to reduce overall tax exposure, with potential compounding benefits as portfolios reinvest savings from taxes [4]. - Active bond ETFs like TAXE possess structural advantages over passive funds, allowing for more flexibility in adapting to market changes, such as replacing bonds when necessary, and focusing on credit quality and yield [5]. Group 3: Future Outlook - As investors approach 2026, there will be a variety of ETFs available, with tax-exempt strategies like TAXE providing the necessary flexibility and adaptability for diverse investment portfolios [6].

Core Insights - Transamerica is expanding its ETF lineup with the launch of two actively managed funds: the Transamerica Large Value Active ETF (TALV) and the Transamerica Bond Active ETF (TABD) to enhance accessibility of its long-standing strategies for modern investors [1] Group 1: Transamerica Large Value Active ETF (TALV) - TALV aims for long-term capital appreciation by investing in a diversified portfolio of large-cap companies that are considered undervalued and positioned for potential price appreciation [2] - The strategy focuses on established firms with solid fundamentals that may be trading below their intrinsic value, featuring a capped net expense ratio of 0.49% compared to a gross expense ratio of 0.76% [3] Group 2: Transamerica Bond Active ETF (TABD) - TABD is designed to deliver total return through a combination of current income and capital appreciation, investing at least 80% of its net assets in fixed income securities across multiple sectors under normal market conditions [4] - The ETF has a capped expense ratio of 0.39% with a gross expense ratio of 0.57%, aiming to provide diversified bond exposure while keeping costs low [4] Group 3: Management and Strategy - Both ETFs leverage established subadvisory relationships, with TALV being sub-advised by Great Lakes Advisors' large value team and TABD overseen by Aegon Asset Management's multisector fixed income team, ensuring access to experienced managers and disciplined investment processes [5]

Core Insights - The ongoing discussions regarding the impact of tariff policies on markets and the U.S. economy are expected to continue, especially following President Trump's announcement of new tariffs on various goods, including pharmaceuticals, furniture, and heavy trucks [1][2]. Tariff Impact Analysis - The recent article from BNY Investments highlights the complexity of determining who bears the financial burden of tariffs, noting that the full impact has yet to be realized due to several factors such as timing delays and exemptions [2][3]. - Initially, domestic firms absorbed the tariff pressures, but evidence suggests that these costs are now being passed on to U.S. consumers, as indicated by the August CPI report showing a 2.9% increase year-over-year [4]. Investment Strategy Recommendations - Given the early stage of tariff impact assessment, advisors and investors are encouraged to consider adding actively managed funds to their portfolios, which can offer flexibility in response to changing market conditions [5][6]. - The BNY Mellon Concentrated Growth ETF (BKCG) is highlighted for its active management and stock selection process, focusing on sectors with growth potential over the next three to five years [7]. - BKCG's high-conviction growth strategy has yielded positive results, with a year-to-date NAV increase of 13.98% as of October 31, 2025 [8].

Core Insights - The October and November jobs reports indicate a struggling economy, with a loss of approximately 105,000 jobs in October and a gain of only 64,000 jobs in November, suggesting potential challenges for investors in the upcoming year [1][2]. Group 1: Economic Impact on Investments - The slowing macro economy may have limited impact on stock prices, but it could also lead to diverse effects on portfolios, including potential Fed rate cuts [1][2]. - Active ETFs provide flexibility in response to market shifts, particularly if the Fed decides to cut rates further in 2026 [2][4]. Group 2: Active ETFs and Investment Strategies - Active equity ETFs offer a range of options, including small-caps, value, large-caps, and growth, allowing for broader allocations and flexibility in portfolios [3][4]. - T. Rowe Price offers various active ETFs, such as the T. Rowe Price Total Return ETF (TOTR) for fixed income and the T. Rowe Price Equity Research ETF (TSPA) for equity exposure, appealing to investors navigating tough jobs data [5].

Group 1 - The U.S. Federal Reserve has implemented its third and final rate cut of 2025, with a quarter-point reduction that has been positively received by most markets, although some fixed-income investors are concerned about falling yields in 2026 [1][2] - There is a strong likelihood of another 25-basis-point cut in early 2026, with over 70% probability according to the CME Group's FedWatch indicator, contingent on economic data assessments by the Fed [2] - Recent dissent among Fed members has been noted, with three members opposing the cut, indicating a divided opinion on future rate adjustments [4] Group 2 - An actively managed strategy, such as an ETF, can provide flexibility and income during periods of rate cuts, allowing portfolio managers to adjust holdings in response to market conditions [5] - The Vanguard Core-Plus Bond ETF (VPLS) is highlighted as a suitable option for fixed-income investors seeking a core bond solution that aims to generate additional income during the current rate-cutting cycle [6][7] - VPLS is characterized by a low expense ratio of 0.20%, making it an attractive low-cost active fund for investors looking for core bond exposure while pursuing higher yields [8]

Core Viewpoint - Cohen & Steers, Inc. is expanding its actively managed exchange-traded funds (ETFs) with the introduction of two new strategies, reflecting a commitment to enhance client portfolio options in today's market [1][2]. Group 1: New ETF Launches - The two new ETFs launched are the Cohen & Steers Infrastructure Opportunities Active ETF (CSIO) and the Cohen & Steers Short Duration Preferred and Income Active ETF (CSSD), which began trading on NYSE Arca [1]. - CSIO focuses on infrastructure companies and aims to capitalize on key growth opportunities such as rising power demand driven by data growth and artificial intelligence [4]. - CSSD is designed to provide tax-efficient income through short-duration preferred securities, emphasizing investment-grade options [4]. Group 2: Market Position and Strategy - Active ETFs are noted as the fastest-growing investment vehicle in the U.S., preferred by wealth managers and clients, indicating a strong market demand for these products [2]. - Cohen & Steers has a long-standing expertise in real assets and alternative income, having been a pioneer in these areas for nearly four decades [2][7]. - The firm now offers five actively managed ETFs that focus on real estate, infrastructure, natural resources, and preferred securities, combining the benefits of active management with lower costs and tax efficiency [2][4]. Group 3: Leadership Insights - The CEO, Joseph Harvey, highlighted that the new ETF launches are a response to increasing investor interest in targeted, actively managed strategies that can generate alpha [3]. - There is a belief that allocations to real assets and preferred securities can yield superior investment outcomes compared to traditional stock-bond portfolios [3].

Core Insights - Investors have two main pathways for core bond exposure through ETFs: passive options that track an index and active options that leverage portfolio managers' capabilities [1] Passive Alternatives - The Vanguard Total Bond Market Index Fund ETF Shares (BND) offers low expense ratios at three basis points and tracks the Bloomberg Barclays U.S. Aggregate Float Adjusted Index, providing broad exposure to investment-grade debt in the U.S. [2] - BND is primarily exposed to U.S. government debt, making benchmark Treasuries the majority of the fund's holdings, which may limit diversification [3] - The newly launched Vanguard Core-Plus Bond Index ETF (BNDP) tracks the Bloomberg U.S. Universal Float Adjusted Index, including U.S. government, investment-grade corporate, securitized, high yield corporate, and emerging market debt, aiming to provide core bond exposure with higher yield potential [4] Active Alternatives - The Vanguard Core-Plus Bond ETF (VPLS) offers active management, allowing portfolio managers to identify income opportunities and adapt to changing market conditions, making it suitable for various economic environments [5] - VPLS maintains exposure to U.S. Treasuries while also investing in mortgage-backed, corporate securities, and emerging market debt to enhance yield [6] - Active ETFs like VPLS are supported by the expertise of the Vanguard Fixed Income Group, which is beneficial in navigating current macroeconomic conditions [7]