ETF Flows and Market Sentiment - ETF investors remain bullish despite market concerns, with VOO reaching $125 billion year-to-date [2] - Outflows are seen in momentum, triple leveraged semi, financials, and cash, but overall sentiment is bullish [3] Mutual Funds vs ETFs - Mutual funds are experiencing significant outflows, potentially reaching $1 trillion this year [4] - Bond mutual funds are vulnerable to rising rates, as seen in 2022 [4] - The introduction of multi-share classes could supercharge the ETF market by allowing managers to launch ETF classes of existing mutual funds [6] - Not every mutual fund should be converted into an ETF; success depends on competitiveness and investor appeal [11] Goldman Sachs Acquisition of Innovator Capital Management - Goldman Sachs is acquiring Innovator Capital Management for $2 billion, a leader in defined outcome ETFs [1][20] - The acquisition is valued at approximately 7% of Innovator's AUM, considered pricey but potentially justified by specialized products and higher expense ratios [24] - Innovator's defined outcome ETFs limit downside risk while capping upside potential, appealing to older investors seeking protection [21][22] Municipal Bond ETFs - Active municipal bond ETFs, like the Intermediate ETF, aim to outperform benchmarks through bond selection [29] - A California-focused muni ETF caters to investors in high-tax states, offering tax-free yield [32][33] - Active muni managers have a high success rate (70%-80%) in beating benchmarks due to the vast number of issuers [36] - State-focused funds are primarily attractive in high-tax states like California and New York [37]