Active ETFs: from experiment to everyday tool

Our latest webinar explored the growth drivers behind active ETFs in APAC and ways to succeed

Key points:

• Active ETFs do two things well: they keep the human or rules-based skill behind a strategy, and they offer the easy access and daily trading people expect from ETFs.
• Active ETFs are a simple way to get value for money and liquidity without giving up manager skill.
• Smaller issuers can compete by being precise about who they target and by improving what happens when visitors land on their pages.

Active ETFs have moved into the mainstream. That was a key theme from our recent webinar, where Fundamental Group’s COO Vincent Hooplot shared what’s driving growth and how managers can succeed in this space.

The shift that made active ETFs inevitable

Investors can now compare fees and performance in seconds. They can also trade from a phone in the middle of the day. In that world, active ETFs do two things well: they keep the human or rules-based skill behind a strategy, and they offer the easy access and daily trading people expect from ETFs.

Europe is already past the “early questions” stage. Assets and new listings have risen through 2024 and into 2025. APAC is growing too, though at different speeds. Australia is mature; Hong Kong is catching up fast. Singapore, South Korea, China and Taiwan are still building out rules and market plumbing, so they’re behind the curve.

In Europe, clear rules on costs and disclosures mean investors expect to see what they’re paying for. APAC is heading the same way, but each market moves at its own pace. Put these rules together with the rise of digital platforms and you get a simple result: model portfolios and advice tools now plan for active ETFs on purpose, often as a “core-plus” holding. The ETF wrapper isn’t just convenient; it fits how portfolios are built today.

Where launches can struggle

Growth headlines can hide the hard parts. New funds often feel “heavy” until they reach about €/$100 million. It’s harder to get there if the product looks like many others on the shelf. Lower fees also squeeze margins, which can push firms towards partnerships or even mergers.

Inside firms, teams don’t always line up. An index-focused sales team may not be set up to explain how an active strategy adds value. A mutual-fund team may not be fluent in ETF mechanics. And some buyers still hear “ETF” and think “cheap index,” even when the strategy is actively managed. None of this is fatal, but it does mean the launch needs a clear plan.

What successful managers do

We see four habits again and again among leaders:

• Play to your strengths. Launch where you have a proven edge, rather than re-wrapping any available strategy.
• Position for whitespace. Be clear about the role: core-plus, income, or downside cushion; the risk you’ll take; or the depth you offer in a region or sector.
• Teach, don’t just tell. Use a short explainer, a simple chart, and a one-pager alongside the detailed note. Show how the strategy aims to add value and what kind of variation from the index to expect.
• Make your website work hard. Guide visitors from interest to action – factsheet reads, ISIN lookups, meeting requests – and track what actually drives those steps.

What we heard in the Q&A

Three points stood out. First, value for money and liquidity are doing most of the work. Active ETFs are a simple way to get both without giving up manager skill. Mutual funds won’t disappear—high-conviction, concentrated ideas still suit that format—but the centre of gravity has shifted.

Second, smaller issuers can compete by being precise about who they target and by improving what happens when visitors land on their pages. Mix long reads with quick, scannable assets. Make the product’s role in a portfolio obvious in seconds.

Third, the media mix is more digital, especially in APAC. We’re seeing more activity on platforms investors already use, more work with ETF-specialist publications, and campaigns that start with education, not just product pushes.

A quick test for your next (or current) active ETF

Before you launch (or while you refine) ask:

• Can we explain the difference in one sentence that a portfolio manager, an allocator and a platform gatekeeper would all recognise?
• Can we show the portfolio fit in under two minutes with one clear visual?
• Does our visitor journey make action easy, from the first click through to a factsheet, an ISIN lookup, or a meeting?

If any answer is “not yet,” you’ve found your next improvement. As shelves fill and platforms become choosier, simple, focused execution wins. For managers who align strategy, story and follow-through, the opportunity is still growing, across Europe, across APAC and across the digital paths investors now take.

At Fundamental Group we have helped several asset managers who struggle with resource to meet their objectives in relation to the above-mentioned points. Please get in touch if you’d like to know more about how we can help you meet your marketing objectives.

This article draws on remarks and live questions from our latest webinar and our active-ETF whitepaper. If you’d like a copy of the whitepaper – or a working session to identify clear white space for your range – please get in touch.