Core Insights - The MFS Market Insights team suggests that mid-cap ETFs present attractive investment opportunities, particularly in the current market environment [1][2]. Market Conditions - Favorable conditions for small- and mid-cap equities include Federal Reserve rate cuts, reduced tariff headwinds, deregulation, and looser fiscal policy [2]. - Mid-cap equities are highlighted as having a stronger opportunity set compared to small-cap equities at this time [2]. Investment Preferences - The MFS team prefers mid-cap stocks over small-caps due to their more attractive valuations, better access to capital, and superior profitability [3]. - Mid-caps are expected to benefit significantly from deregulation, as they face a higher regulatory burden than both small and large-cap stocks [3]. Active Management Strategy - Given the volatile and headline-driven nature of factors affecting mid-caps, an actively managed approach is recommended for mid-cap exposure [3]. - Actively managed funds provide more flexibility and leverage the expertise of experienced portfolio teams [3]. Fund Highlight - The MFS Active Mid Cap ETF (MMID) is designed to enhance exposure to mid-caps through active management, focusing on quality and franchise durability [4]. - The fund employs various metrics for security selection, with a strong emphasis on cash flow-based methodologies to identify stocks with higher growth potential [5]. Overall Strategy - The strategy combines the benefits of active management with a flexible approach to identify compelling mid-cap investment opportunities [6]. - In a market where mid-caps may outperform, funds like MMID could significantly impact investment portfolios [6].