Core Insights - Active investing is gaining traction as investors seek diversification beyond major technology stocks, with strategies that combine data-driven models and managerial judgment becoming more popular than passive approaches [1][2] - Smart beta ETFs attracted approximately $37 billion in 2025, indicating a shift towards rules-based active strategies that allow for managerial flexibility in response to market conditions [1][6] Investment Strategies - Rules-based active strategies utilize analytical frameworks similar to smart beta funds but provide portfolio managers the ability to adjust holdings based on market dynamics rather than fixed schedules [2][3] - T. Rowe Price has launched two active ETFs, TACU and TACN, which hold significantly more positions than typical active funds, with TACU containing 550-650 holdings and TACN holding 400-500 positions [4][5] Fund Management Approach - The new active ETFs from T. Rowe Price combine quantitative research with fundamental analysis, allowing for low tracking error against benchmarks while enabling active management when opportunities arise [5] - This dual approach differentiates these funds from purely quantitative strategies and traditional fundamental approaches, as they leverage both data models and analyst insights [5] Market Trends - Predictions indicate that inflows into smart beta and quantitative strategies will continue to rise in 2026, with the distinction between smart beta and quantitative active management becoming increasingly blurred [6]