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Just For You Active ETFs Surge Past Passive, and These Are in the LeadBy Nathan Reiff. Posted: 3/23/2026. 
Key Points - Actively managed ETFs have seen significant acceleration of inflows in the last year, potentially signaling a shift in how investors approach this space.
- Two active funds that may be worth a closer look include CGDV and TCAF, with a focus on dividend value and a GARP approach, respectively.
- Other passive funds may reflect some aspects of active ETFs, such as IVES, which is based on an index but tied to the views of technology analyst Dan Ives.
- Special Report: Elon Musk already made me a "wealthy man"
Exchange-traded funds (ETFs) are widely known for simplifying investing for individual investors and for keeping costs low by passively tracking indices. Interestingly, however, actively managed ETFs—those managed by portfolio managers rather than tied to an index and generally charging higher fees—have been growing faster than their passive counterparts. Goldman Sachs reports that inflows into active ETFs were roughly four times stronger than those into passive ETFs last year. Active ETFs can potentially capture alpha and employ more sophisticated strategies, which may appeal to more adventurous investors. In today's crowded ETF market, two actively managed ETFs—and one passive fund that mimics an active approach—stand out. CGDV Aims for Dividends and Price Appreciation Through an Active Approach During Tesla's last earnings call, Elon Musk outlined a new AI-driven approach he says could generate $30,000-$50,000 a year in passive income with minimal effort and modest upfront costs. U.S. Senator Ted Cruz called it 'a total game-changer,' and millions of Americans are reportedly eligible to participate. This is a new business model, and early movers could be positioned for significant returns. Watch the free presentation and learn how to get started today The Capital Group Dividend Value ETF (NYSEARCA: CGDV) targets dividend income above the average U.S. stock yield, emphasizing large, established domestic companies and selectively including large international firms. Managers diversify across sectors, though information technology, industrials, and healthcare are the largest exposures. At least 90% of the fund's equity assets are invested in stocks with issuer ratings of investment grade or better, positioning CGDV as a potentially stable source of income during market turbulence. Its active mandate gives managers flexibility to adjust holdings as conditions change, which may appeal to investors seeking a defensive yet nimble strategy. CGDV holds just over 50 dividend-paying stocks, including names such as Applied Materials Inc. (NASDAQ: AMAT) and Microsoft Corp. (NASDAQ: MSFT). Although its 0.33% expense ratio is higher than many passive dividend ETFs, CGDV's one-year return of nearly 21% and its 1.31% dividend yield may justify the fee for some investors. TCAF's Core Equity Approach Combines Big Names With Lesser-Knowns The T. Rowe Price Capital Appreciation Equity ETF (NYSEARCA: TCAF) employs a core equity, growth-at-a-reasonable-price (GARP) approach. Managers are not constrained by market-cap or style boxes and build the portfolio bottom-up by selecting individual companies they believe offer strong fundamentals and reasonable valuations. The result is a portfolio of about 100 companies screened for financial strength, performance history, and growth potential. TCAF can serve as a core holding to provide diversified exposure to many large U.S. names while also including less familiar firms, such as pharmaceutical distributor Cencora Inc. (NYSE: COR). The fund carries a 0.31% expense ratio. Over the past year the basket returned just over 10%, slightly trailing the broader market. Still, TCAF has seen a notable inflow surge in the last year, including nearly $1.9 billion in institutional inflows, which could make it worth a closer look for potential future gains. A Non-Active Fund Mimicking an Active Approach The push toward active management has even influenced some passive ETFs. The Dan Ives Wedbush AI Revolution ETF (NYSEARCA: IVES) is passively managed but tracks an index tied to Dan Ives, a technology analyst at Wedbush Securities, reflecting his convictions about the AI sector. With a 0.75% expense ratio—higher than most passive funds—investors gain access to an index built from Ives' selections. Many of the roughly 30 holdings are familiar large-cap tech names that are also available through other ETFs, but IVES' unique weighting and multi-cap approach can differentiate its portfolio. This fund may appeal to investors who follow Dan Ives' research and share his optimism about the AI revolution. Launched in June 2025, IVES doesn't have a long performance track record yet, but it has already attracted close to $1 billion in assets and trades actively, with a one-month average trading volume above 500,000. |
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