Welcome to ETF Edge, your go-to place for all things exchange traded funds. I'm your host, Dominic Chu. Geopolitical tensions, domestic headlines, currency flows, and the Fed have reignited that whole US versus international investing debate.So joining me now are John Mayer, the chief ETF strategist over at JP Morgan, alongside Tim Seymour, the chief investment officer at Seymour Asset Management. He's also a CNBC contributor. Uh gentlemen, thank you both for being here with us today for ETF Edge.Uh perhaps ...

Global Economic Outlook - The BNY Investments team anticipates that the global economy is "primed for a steady advance" through 2026, but emphasizes the importance of being aware of subtle changes that can impact the economic landscape [5] United States - Economic headwinds in the U.S. are expected to "lessen," driven by lower tariff uncertainty, Federal Reserve policy, and favorable fiscal policy [2] - U.S. growth is projected to be fueled by consumer spending, supported by disposable income and tax refunds [2] Europe - The outlook for Europe indicates "only gradual growth" in 2026, influenced by capacity constraints in construction and defense procurement, along with political uncertainties in France [3] - Despite challenges, there are positive indicators in specific countries, such as Germany [3] China - China's economic performance is bolstered by diversified exports and advancements in AI, although growth is beginning to wane [4] - Further fiscal stimulus is anticipated in the first half of 2026, which could enhance stock positions in the country [4] Investment Strategies - The BNY Mellon Concentrated Growth ETF (BKCG) focuses on a concentrated approach to growth investing, targeting 25-35 companies expected to expand over the next three to five years [6][7] - The BNY Mellon Concentrated International ETF (BKCI) offers a concentrated portfolio of international stocks, utilizing a fundamental, bottom-up approach without specific focus on geographic or sector allocations [8]

Core Insights - Avantis Investors has achieved significant growth, reaching $100 billion in assets under management in just six years, with a notable acceleration in the past year and a half, doubling its assets [1] - The firm has attracted approximately $28 billion in net new money year to date, indicating strong investor interest [1] Group 1: ETF Performance - Over 90% of Avantis' assets are in ETFs, with the US Small Cap Value ETF (AVUV) accounting for about 20% of total assets, which has increased by 9% this year [3] - The Emerging Markets Equity ETF (AVEM) has seen a nearly 30% increase year to date, while the International Small Cap Value ETF (AVDV) has risen about 46% [3] - The International Equity ETF (AVDE) has returned 35% this year, showcasing strong performance across multiple funds [3] Group 2: Cost Efficiency and Market Position - Avantis has positioned itself as a cost-effective option for investors, with AVUV's expenses at 25 basis points, lower than the category average of 35 basis points [4] - The firm has become the fourth-largest active ETF issuer, primarily due to the success of Avantis [5] - The Avantis ETFs AVUV, AVEM, and AVDV rank as the ninth, thirteenth, and fifteenth largest actively managed ETFs in the US market, respectively [6] Group 3: Industry Trends - In 2025, 86% of ETF launches were actively managed, with $378 billion flowing into this category year to date, representing 35% of all ETF sales [6] - The shift towards actively managed ETFs reflects a growing trend among investors seeking more personalized investment strategies [2]

Acquisition and Expansion - Goldman Sachs agreed to acquire Innovator Capital Management, a provider of defined outcome ETFs, for approximately $2 billion [1] - The acquisition expands Goldman Sachs Asset Management's (GSAM) product offerings, particularly in actively managed ETFs and defined outcome/income-oriented ETFs [2] Demand and Growth of Defined Outcome ETFs - Client conversations reveal increasing interest in Buffer ETFs and defined outcome ETFs [3] - The defined outcome ETF category, invented in 2018, has experienced a cumulative average growth rate of approximately 60% over the past 5 years [5] - Research suggests the defined outcome ETF category could grow by four to five times over the next 5 years [5] Features and Benefits of Defined Outcome ETFs - Defined outcome ETFs can provide downside protection and a smoother investment experience while maintaining equity exposure [7] - These ETFs can be used to gradually re-enter the market and build a diversified portfolio aligned with specific investment goals [8] - The defined outcome category includes income-oriented strategies for yield enhancement and targeted buffer strategies for downside protection [9] - Innovation in the defined outcome space includes dual directionals and auto callables, offering institutional-level strategies through ETF technology [10][11] Example ETF Performance - The Innovator Defined Wealth Shield ETF (BALT) has more than doubled the performance of the S&P 500 in a one-year period [6]

Core Insights - The ETF industry has seen record inflows, with $1.1 trillion invested year-to-date, surpassing previous records and indicating strong investor interest [3][4][23] Industry Overview - The ETF market crossed the trillion-dollar mark at the end of the previous year, ending with $1.12 trillion, and is on track to set new records [4][5] - There has been a notable demand for fixed income ETFs and international equities, which were not anticipated a year ago [5][6] Popular Funds - The Vanguard S&P 500 ETF (VOO) has crossed $100 billion in net inflows, making it the only ETF to achieve this milestone [7][8] - Other popular ETFs include State Street's low-cost S&P 500 ETF (SPYM) and iShares S&P 500 ETF (IVV) [8] - Actively managed ETFs have gained traction, accounting for nearly 40% of net flows this year, indicating a shift in investor preferences [9][10] New Fund Types - New fund types, including those utilizing options strategies and covered calls, are gaining traction, with J.P. Morgan's Nasdaq Equity Premium ETF (JEPQ) nearing $10 billion in assets [12][13] Market Dynamics - There is a shift of assets from traditional mutual funds to ETFs, with net outflows from equity mutual funds contributing to the inflows into ETFs [14][15] - The ETF market is expected to continue growing, with projections of breaking $1 trillion in net inflows again by 2026 [16][20]

Core Insights - Capital Group's active ETF lineup has reached $98 billion in assets as of November 5, demonstrating rapid growth since the launch of six ETFs in February 2022 [1] - The firm has become a top three active ETF manager in the U.S. with 25 ETFs, driven by the adoption of their products by 47,000 advisors, many of whom are new to Capital Group [2] Asset Performance - Seventeen Capital Group ETFs have surpassed $1 billion in assets, with the Capital Group Dividend Value ETF (CGDV) managing $24 billion, primarily invested in U.S. dividend-paying stocks [3] - The Capital Group Core Plus Income ETF (CGCP) manages $6 billion and offers a 5.2% yield, while the Capital Group Municipal Income ETF (CGMU) has $4.4 billion in assets [4][5] Market Trends - Active fixed income ETFs have seen significant growth, with over $20 billion in assets across 10 strategies, reflecting a shift from mutual funds to ETF vehicles [5] - Actively managed ETFs gathered $409 billion in the first 10 months of 2025, with $48 billion in October alone, indicating strong demand and market share growth for Capital Group [7] New Product Development - Newer products like the Capital Group U.S. Small and Mid Cap ETF (CGMM), launched in January 2025, are gaining traction, with assets approaching $900 million despite redemptions in other small-cap ETFs [6]

Core Insights - Pictet Asset Management has launched three new actively managed ETFs in the U.S. market, marking a significant expansion for the firm [1][2][3] Group 1: Fund Launches - The newly launched ETFs are the Pictet AI Enhanced International Equity ETF (PQNT), Pictet Cleaner Planet ETF (PCLN), and Pictet AI & Automation ETF (PBOT) [1][4] - These funds target specific market segments known as "megatrends" and utilize unique strategies, including AI-driven quantitative and thematic screeners [4][6] Group 2: Investment Strategy - Each fund employs an active management strategy, which allows for greater market flexibility and the ability to adjust holdings in response to market conditions [5] - The use of AI in these funds aims to maintain transparency and factor-neutrality, distinguishing Pictet from other U.S.-based active managers [6][8] Group 3: Fund Objectives - PQNT aims to outperform the MSCI EAFE Index using an enhanced index strategy with a low tracking error, screening for opportunities through an AI model that incorporates over 250 market data features [7] - PCLN focuses on companies contributing to a sustainable economy, evaluating them based on fundamental metrics related to environmental and social impact [7] - PBOT invests in companies linked to AI and automation, including those in robotics, cybersecurity, and semiconductors, emphasizing their role in enhancing everyday life [7]

Core Insights - The global ETF market is experiencing significant growth, with a record number of new fund launches in the first half of 2025, totaling 1,308 new ETFs compared to 878 in the same period last year, resulting in a net increase of 1,042 ETFs after accounting for 266 closures [1][2] - The total global ETF assets under management (AUM) reached $17 trillion as of June 2025, surpassing the previous high of $16.3 trillion set in May, with year-to-date ETF inflows hitting $897.7 billion, marking an all-time high [2] ETF Launches and Trends - BlackRock's iShares led the new ETF launches with 42, followed by Global X with 36 and First Trust with 27, among a total of 326 different providers introducing new products [2] - Key trends driving the growth in ETF launches include: - Actively Managed ETFs gaining popularity as investors seek flexible strategies in volatile markets [3] - Thematic Funds focusing on niche areas like artificial intelligence and clean energy attracting significant inflows [4] - Innovative Structures offering exposure to digital assets and derivatives-based strategies expanding market breadth [4] - Factor-Based Strategies focusing on value, momentum, quality, size, and minimum volatility becoming increasingly popular [4] - Mutual Fund to ETF conversions as asset managers launch ETF versions of traditional mutual funds to meet investor demand [5] Notable ETF Performances - The JPMorgan Mortgage-Backed Securities ETF (JMTG) has accumulated $5.8 billion in AUM since its launch on June 27, 2025, primarily investing in mortgage-backed securities with a broad basket of 2,427 securities [6] - The JPMorgan Active High Yield ETF (JPHY) has garnered over $2 billion in AUM since its debut on June 24, 2025, focusing on below investment-grade debt securities with a yield to maturity of 6.35% [7] - The 0-3 Month Treasury Bill ETF (VBIL) has attracted $2.1 billion in AUM since its launch on February 7, 2025, tracking a market-weighted Treasury index with an ultra-short-term maturity [8] - The iShares High Yield Muni Active ETF (HIMU) has amassed $1.8 billion in AUM since its launch on February 7, 2025, aiming to provide income exempt from federal taxes [9][10] - The Simplify Government Money Market ETF (SBIL) has gathered $1.2 billion in AUM since its debut in July 2025, focusing on liquidity and principal stability [11]