Building modern multi-asset class portfolios with active ETFs

Key Takeaways

Active ETFs seek different sources of return than index ETFs, but offer the same vehicle benefits.
A wide variety of strategies for outperformance fall within the active ETF category, including quantitative and hybrid strategies, not just those driven by fundamental security selection.
This variety of approaches offers varying levels of benchmark relative risk; the type of strategy you select and how you allocate your portfolio's risk budget can impact your potential for excess return.
Active strategies may also allow investors to achieve objectives other than outperformance, such as increased diversification, higher income, or reduced volatility and/or drawdowns.