And welcome back to halftime with your we have your ETF edge. We're seeing two big pushes in the industry this week getting very different receptions. Let's jump right into it.Joining me now is independent ETF expert Dave Natig. Dave, thanks for joining us. Thanks for having me.All right, let's start off first. I get back to those two big players diving into the active management arena. We got billionaire investor Ron Baron launching his own fund and lowcost king Vanguard filing for a new fundamentals fund ...

Welcome to CNBC. com. I'm Frank Colin, anchor worldwide exchange.We are looking at the ETF action this week. Year-to-date net ETF inflows. They've topped 645 billion dollars according to the latest data from Vify.Join me now to discuss some of the action in the ETF market. I'm joined by Phil McInness at Vandis Investors by American Century Investments. He is their chief investment strategist.Phil, thanks so much for being here with us. >> Thanks, Frank. Pleasure to be here.Um, I I just want to start off jus ...

Financial Data and Key Metrics Changes - MSCI reported revenue growth of over 9% in Q2 2025, adjusted EBITDA growth of over 10%, and adjusted earnings per share growth of almost 15% [7] - Free cash flow exceeded $300 million, with $286 million worth of shares repurchased year-to-date at an average price of $557 per share [7] - Total run rate growth was 11%, driven by record AUM levels in ETF products linked to MSCI indices, and asset-based fee run rate growth was 17% [7][8] Business Line Data and Key Metrics Changes - Subscription run rate growth was double-digit across banks, broker-dealers, wealth managers, hedge funds, and asset owners, with notable growth of 10% in banks and broker-dealers, 12% in hedge funds, and 17% in wealth managers [15][17][20] - The index and asset-based fee franchise was highlighted as a key growth engine, with total equity index ETF AUM linked to MSCI indices surpassing $2 trillion for the first time [9] - Private assets saw a run rate growth of nearly 13%, with significant product launches enhancing capabilities in private capital solutions [10][11] Market Data and Key Metrics Changes - MSCI captured more indexed equity ETF cash flows than any other index provider during the quarter, with total index ETF and non-ETF AUM balances tracking MSCI indices reaching $6 trillion [9] - Equity ETFs linked to MSCI indexes experienced $49 billion of inflows, capturing 29% of all inflows into indexed equity ETFs [26] - Subscription run rate growth for sustainability and climate solutions was 11%, with 18% growth in Europe [29] Company Strategy and Development Direction - MSCI is focused on expanding its capabilities in private assets and enhancing its integrated franchise to create powerful network effects for clients [12][14] - The company is adapting its tools to capture new opportunities in sustainability and climate, despite current cyclical slowdowns [13] - There is a strong emphasis on innovation and developing new solutions for diverse client segments, particularly in the fast money segment [8][43] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the rotation of assets from the U.S. market to international markets, which is expected to boost the asset-based fee business [36] - The company anticipates that the current dynamics in the market will persist for the next several quarters, with a focus on maintaining and enhancing retention rates [32][44] - Management acknowledged challenges in the active asset management industry but emphasized the potential for growth in non-active segments and the wealth management sector [42][65] Other Important Information - MSCI's retention rate for private assets remained stable at slightly over 91% [31] - The company is seeing promising growth potential among insurance companies for products supporting index-linked annuities and climate tools [24] - MSCI's guidance remains unchanged across all categories, indicating confidence in its financial model [32] Q&A Session Summary Question: Potential help from asset flows into international markets - Management noted that the rotation of assets from the U.S. to international markets is a significant boost for the asset-based fee business, with $6 trillion of client assets indexed to MSCI indices [36] Question: Accelerating growth in subscription business - Management indicated that to accelerate total subscription run rate, non-active asset managers need to grow faster, and they are focusing on creating new products and enhancing client engagement [42][44] Question: Impact of consolidation on results - Management acknowledged ongoing consolidation trends but expressed confidence that it would not significantly impact forecasts or pipelines [48] Question: Retention rates in analytics and sustainability - Management explained that retention rates can be lumpy and noted elevated cancels from hedge funds and corporate advisors, but overall retention with asset managers remains solid at around 96% [55] Question: Sales environment and outlook - Management characterized the sales environment as consistent with recent quarters, with a healthy pipeline of products and client engagement [60] Question: Demand for custom indexes - Management remains confident in the growth potential for custom indexes, despite slight fluctuations in quarterly numbers [70] Question: Positioning with active ETFs - Management highlighted significant growth opportunities in active ETFs, with ongoing dialogues with active asset managers and a focus on enhancing product offerings [75]

Financial Data and Key Metrics Changes - MSCI reported revenue growth of over 9% in Q2 2025, adjusted EBITDA growth of over 10%, and adjusted earnings per share growth of almost 15% [6][24] - Free cash flow exceeded $300 million year-to-date, with $286 million worth of shares repurchased at an average price of $557 per share [6][24] - Total run rate growth was 11%, driven by record AUM levels in ETF products linked to MSCI indices, and asset-based fee run rate growth was 17% [6][24] Business Line Data and Key Metrics Changes - Subscription run rate growth was double-digit across various client segments, including 10% for banks and broker dealers, 12% for hedge funds, and 17% for wealth managers [14][19] - The index and asset-based fee franchise was identified as a key growth engine, with strong ABF run rate growth reflecting the importance of MSCI indices in global investing [7][24] - Private assets saw a run rate growth of nearly 13%, with significant product launches enhancing capabilities [10][11] Market Data and Key Metrics Changes - Total equity index ETF AUM linked to MSCI indices surpassed $2 trillion for the first time, driving total AUM balances to $6 trillion [8][24] - Equity ETFs linked to MSCI indexes experienced $49 billion of inflows during Q2, capturing 29% of all inflows into indexed equity ETFs [24] - Indexed equity ETFs linked to MSCI Developed Markets ex U.S. Indexes captured $32 billion, representing over 50% of all flows into DM ex U.S. indexed equity ETFs [24] Company Strategy and Development Direction - MSCI is focused on expanding its capabilities in private capital solutions and enhancing its product offerings to drive adoption across the investment community [10][11] - The company aims to leverage its integrated franchise to create powerful network effects for clients, particularly in sustainability and climate solutions [12][13] - MSCI is adapting its tools to capture new opportunities in the sustainability space despite current cyclical slowdowns [12][13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth potential of the company, emphasizing the importance of asset-based fees and the transformation towards non-active asset management client segments [60][62] - The current dynamics in the market are expected to persist for the next several quarters, with a focus on maintaining and enhancing retention rates across client segments [28][51] - Management highlighted the ongoing demand for climate solutions and the need for banks and insurance companies to understand climate risks [92][94] Other Important Information - MSCI's retention rate for private assets remained stable at slightly over 91% [28] - The company completed its largest deal ever for MSCI Wealth Manager during the quarter, indicating strong demand for unified solutions [19][24] - MSCI is seeing promising growth potential among insurance companies, particularly for products supporting index-linked annuities and climate tools [21][22] Q&A Session Summary Question: Potential help from asset flows into international markets - Management noted that the rotation of assets from the U.S. to international markets is a significant boost for the asset-based fee business, with $6 trillion of client assets indexed to MSCI indices [34] Question: Accelerating growth for asset managers - Management indicated that to accelerate total subscription run rate, non-active asset managers need to grow faster, and they are focusing on creating new products and enhancing sales efforts [39][40] Question: Impact of consolidation on results - Management acknowledged ongoing consolidation in the industry but does not expect it to significantly impact results in the near term [45] Question: Retention rates and outlook - Management explained that retention rates can be lumpy, with recent lower retention in analytics and sustainability due to client events and budget pressures [50][51] Question: Sales environment and outlook - Management characterized the sales environment as consistent with recent quarters, with a healthy pipeline of products and sustained favorable market dynamics [55][56] Question: Demand for custom indexes - Management remains confident in the growth opportunity for custom indexes, despite slight fluctuations in quarterly numbers [66] Question: Active ETFs and market positioning - Management highlighted significant growth opportunities in active ETFs, with ongoing dialogues with active asset managers [72][73] Question: Cost guidance and market assumptions - Management reiterated that expense guidance remains unchanged, with AUM levels expected to influence costs towards the middle of the guidance range [78][79] Question: Growth opportunities in fixed income and wealth management - Management expressed confidence in sustaining growth rates in fixed income and wealth management, with ongoing investments in capabilities [82][83] Question: Deceleration in hedge fund subscription growth - Management noted that the hedge fund segment is inherently lumpy, and recent deceleration is not indicative of long-term trends [86][87] Question: Acceleration of non-active subscription growth - Management indicated that significant opportunities exist in the fast money segment and wealth management, with ongoing efforts to prioritize and build up these areas [90][92]

Roger Hallam, Vanguard global head of rates, sits down with CNBC’s Dominic Chu to discuss the firm’s new active ETFs launching this week, including its Vanguard Government Securities Active ETF. Hallam gets into the strategy behind the fund and why now is the time to go active. Jay Jacobs, BlackRock U.S. Head of Equity ETFs also joins the conversation. ...

Core Viewpoint - T. Rowe Price has launched three new active transparent equity ETFs, expanding its lineup to a total of 22 offerings, aimed at providing long-term capital appreciation through sector-specific investments [1][2][4]. Group 1: New ETF Launches - The newly launched ETFs are T. Rowe Price Financials ETF (TFNS), T. Rowe Price Health Care ETF (TMED), and T. Rowe Price Natural Resources ETF (TURF) [1][2]. - Each ETF has an expense ratio of 0.44% and seeks to invest at least 80% of its net assets in their respective sectors [2][3][4]. Group 2: Investment Strategies - TFNS focuses on the financial services industry, typically maintaining a portfolio of 50-70 companies [2]. - TMED targets health care innovations, with a diversified portfolio of 100 to 150 stocks across biotechnology, pharmaceuticals, and health care services [3]. - TURF invests in natural resource companies, primarily in energy, minerals, and agriculture, holding 60-80 securities globally [4]. Group 3: Company Background - T. Rowe Price, founded in 1937, manages USD $1.62 trillion in assets as of May 31, 2025, and is known for its investment excellence and active management approach [5]. - The firm has a commitment to growing its active ETF business and aims to deliver compelling investment ideas through rigorous global research [5].

Core Insights - Active ETF assets have grown over 600% in the past five years, reaching $631 billion in 2024, indicating a significant expansion in this investment vehicle [1] - The whitepaper titled "Active ETFs: Achieving Escape Velocity" outlines strategic imperatives for asset managers to successfully launch and scale active ETFs [1][2] Industry Trends - In 2024, a record 660 active ETFs were launched, yet they only account for 6% of total active AUM, suggesting substantial growth potential [2] - The top 10 active asset managers control 77% of active ETF assets, highlighting a concentration challenge within the industry [7] Strategic Principles for Asset Managers - **Go with the Flow**: Success relies on strong distribution, particularly through Registered Investment Advisor (RIA) channels, which dominate active ETF assets [3] - **Pick a Lane**: Successful managers leverage unique investment strategies, proprietary distribution channels, and strong brand identity, focusing on their inherent strengths [4] - **Less is More**: Engaging with high-potential advisors who already utilize active ETFs can enhance conversion rates and sales, emphasizing the importance of advisor scoring and segmentation [5] Future Projections - Active ETF assets are projected to grow to $1.2 trillion by 2027, up from $81 billion in 2019, indicating a robust growth trajectory [7] - Only 11% of active ETFs launched in the past three years raised over $100 million in their first year, which is a critical success indicator [7]

Core Viewpoint - Invesco Ltd. has launched three new active ETFs that leverage the expertise of its in-house active managers, aiming to meet investor demand for high-quality active strategies through the ETF vehicle [2][3]. Group 1: New ETF Strategies - The three newly launched ETFs are: Invesco QQQ Hedged Advantage ETF (QQHG), Invesco Comstock Contrarian Equity ETF (CSTK), and Invesco Managed Futures Strategy ETF (IMF) [2][3]. - QQHG aims to track the performance of the Nasdaq 100 Index while implementing an option overlay strategy to manage downside risk [9]. - CSTK focuses on total return through capital growth and income by identifying discrepancies between stock prices and company values [9]. - IMF employs a futures strategy that takes both long and short positions across various global markets, seeking long-term capital appreciation with low correlation to traditional markets [9]. Group 2: Market Position and Strategy Evolution - The launch of these ETFs reflects Invesco's commitment to evolving its ETF lineup to align with investor preferences and demands [3][4]. - The new active ETFs represent a continuation of Invesco's focus on rules-based ETF development, combining human judgment with established rules-based strategies [4]. - Invesco aims to educate investors on how these active ETFs can fit into their portfolios as the market for such products evolves [4]. Group 3: Company Overview - Invesco Ltd. is a global independent investment management firm managing approximately US$1.8 trillion in assets as of March 31, 2024 [5]. - The firm operates in over 20 countries and offers a comprehensive range of active, passive, and alternative investment capabilities [5].