ETF Intel Q&A: T. Rowe Price

Danielle Rutsky, Lead Product Manager of ETF Listings at Nasdaq, joins Tim Coyne, Head of Exchange-Traded Funds at T. Rowe Price, for a conversation about bringing Investor awareness to their active ETFs.

What are some of the key initiatives you are currently focused on at T. Rowe Price?

At T. Rowe Price we’re focused on bringing overall investor awareness to active ETFs and specifically our lineup of strategies. Our clients continue to express interest in accessing our strategies in multiple formats, including ETFs. The pace of adoption for our active ETFs has been consistently increasing as we have recently crossed more than $10 billion in ETF assets under management after registering over $5bn of inflows in 2024. So, our focus is on continued promotion of our existing strategies with advisors and investors, while expanding our lineup into areas where we believe actively managed ETFs have been traditionally underrepresented.  In addition, we are investing further in our ETF business developing resources for our clients and adding more expertise to our ETF platform across ETF specialists, sales, marketing and capital markets.

What trends are you seeing for actively managed ETFs?

There’s clearly an appetite for more choice with ETFs. Actively managed ETFs saw strong demand in 2024, and we expect that to continue throughout this year. The passive marketplace is fairly saturated and still represents more than 90% of all ETFs. But momentum continues to build rapidly with active ETFs representing approximately 25% of all ETF inflows and more than 80% of all new ETF launches in 2024. Active ETFs are gaining market share as investors look to move beyond the limitations of indexing.  I think this trend will continue as more and more active ETFs come to market and prove their value proposition. We think 2025 can be an important year for the evolution of regulations in new areas like emerging asset classes and ETFs as a share class. We’re seeing a lot of innovation across the industry as new strategies, categories and asset classes become available through actively managed portfolios.

You launched the T. Rowe Price Technology ETF (TTEQ) and T. Rower Price Intermediate Municipal Income ETF (TAXE) on Nasdaq. What are possible use cases for investors utilizing these strategies?

T. Rowe Price Technology ETF (TTEQ) focuses on identifying enduring technology-enabled companies that operate in areas critical for the technology industry. It invests in established companies but also those that are innovating in secular growth markets. Leaning on our firm’s vast global research resources, we look for firms with improving fundamentals and are also available at reasonable valuations. Index-based strategies tend to be limited in scope to specific sub-segments of technology, like semi-conductors or electronics. Our broader scope allows investors exposure to areas of technology that they may be lacking though through narrowly defined indexes.

T. Rower Price Intermediate Municipal Income ETF (TAXE) is for investors seeking exposure to intermediate-term municipal bonds, with a national focus, that seeks to provide a compelling risk-adjusted yield that can translate into an attractive stream of tax-free income over time. We believe that by combining experienced portfolio management and independent fundamental research within a disciplined investment process, we can isolate attractive risk-adjusted yields in a meaningful way that goes beyond an indexed approach.

What's next for T. Rowe over the next 12 months?

Over the next year we expect to see continued growth of active ETFs across the industry and at T. Rowe Price. Our goal is to provide investors with access to our long-standing global investment capabilities. We have a long history of providing a diverse range of strategies across a full range of market segments. That long history and our firm’s trusted reputation has led to increasing levels of interest in our growing lineup of active strategies. For example, we continue to engage with advisors on portfolio construction and modeling with our active ETFs and we expect to expand as our lineup continues to grow. Having been in-market for close to five years, intermediary and institutional investors who have traditionally used passive strategies now have a growing appetite for high quality active strategies delivered as ETFs. As one of the industry’s global leaders in active management, we plan to continue to expand our lineup of actively managed ETFs driven by deep fundamental analysis and research.