Bill Miller, the legendary Wall Street trader, is planning to launch two new actively traded exchange-traded funds (ETFs) through his firm, Miller Value Partners. The Miller Value Partners Appreciation ETF will invest in securities that the issuer believes will outperform the S&P 500 over a multi-year time horizon, while the Miller Value Partners Leverage ETF will seek daily leveraged investment results corresponding to two times the performance of an underlying index.
Active funds, which charge higher management fees compared to passive funds, have become increasingly popular among investors, pulling in $14.3 billion last month and beating last year’s year-to-date figure of $22.3 billion. The launches also come as actively managed funds have become a new favorite among ETF issuers. However, the records of active fund managers in beating broad indexes have been mixed, with 51% of large cap domestic equity active managers underperforming the S&P 500 last year.
ETF Newz Says:
It is yet to be seen whether the favorable outcomes for active management will continue in 2023. Allianz Chief Economist Mohamed El-Erian recently stated that index strategies would work best going forward in the most liquid asset classes that are not subject to default. The expense ratios and tickers for Miller's ETFs have not yet been assigned.