BALTIMORE, July 6, 2020 /PRNewswire/ --
NEWS
- T. Rowe Price (NASDAQ-GS: TROW)
announced that the U.S. Securities & Exchange Commission (SEC)
has granted the remaining approvals necessary for the firm to bring
to market four active exchange-traded funds (ETFs), which will be
listed on NYSE Arca, Inc. These latest milestones clear the path
for T. Rowe Price to introduce ETFs
in an active management format that has characterized the firm's
investment approach for more than 80 years.
- Constructed similarly to investment strategies that have served
clients well for decades, the first T. Rowe
Price active ETFs will include the Blue Chip Growth ETF, the
Dividend Growth ETF, the Equity Income ETF, and the Growth Stock
ETF.
- The active ETFs will use the same investment strategies and
portfolio managers as their corresponding mutual funds. While many
existing ETFs track passive indexes, the T. Rowe Price active ETFs will employ the firm's
established strategic investing approach, characterized by rigorous
research and risk awareness, and carried out by more than 600
investment professionals around the globe.
- ETFs will diversify and complement T. Rowe Price's traditional mutual fund offerings
for investors who prefer the intraday trading, tax efficiency, and
cost structure ETFs provide. However, the firm believes mutual
funds will remain a key vehicle for many investors.
- The T. Rowe Price active ETFs
will offer the key features associated with existing ETFs,
including continuous daily trading, real-time market determined
pricing, and tax efficiency, but with the opportunity for investors
to pursue returns in excess of market indexes.
- T. Rowe Price's active ETFs will
feature a proprietary portfolio disclosure process that will ensure
market makers have enough information to quote prices with a high
degree of confidence, while it also protects the intellectual
property of the firm's investment professionals and the interests
of its funds shareholders.
- Over time, T. Rowe Price plans
to deliver a robust ETF product lineup covering investments in
various asset classes.
- Through strategic alliances, T. Rowe
Price plans to offer its active ETF model to other asset
managers interested in bringing their own active ETFs to
market.
- T. Rowe Price anticipates
launching its active ETFs in 2020.
QUOTES
Rob Sharps, Head of Investments,
Group Chief Investment Officer
"By securing all of the necessary approvals for our active ETFs, we
have reached a significant milestone that will enable us to bring
T. Rowe Price's time-tested
investment management capabilities to the ETF marketplace. When
launched, these ETFs will be the only ones in the market informed
by T. Rowe Price's strategic
investing approach and supported by our global research platform of
more than 600 investment professionals. We believe this makes them
distinct."
Tim Coyne, Head of
Exchange-Traded Funds
"Today, active ETFs from T. Rowe
Price are a step closer to reality. As the ETF industry
evolves to include active ETFs, T. Rowe
Price is on the path to deliver flagship investment
strategies in this new way. We believe that financial advisors and
investors seeking the benefits of the ETF structure will find T.
Rowe Price's active ETFs to be
compelling as we work to deliver quality offerings that meet a
range of needs."
George Riedel, Head of U.S.
Intermediaries
"The pending launch of our active ETFs gives us a new way to meet
investors' evolving needs while still tapping the investment
expertise of a skilled and experienced portfolio management team,
which across the firm has an average of 22 years of industry
experience, including 17 years with T. Rowe
Price. Through this new vehicle, RIAs, private banks, broker
dealers, and individual investors alike will have access to the
building blocks that will help them develop foundational investment
portfolios."
Scott Livingston, Head of Global
ETF Product
"We know that one size doesn't fit all for investors, so the new
active ETFs will complement T. Rowe
Price's current offerings and broaden the appeal of our
investment capabilities. Whether seeking to fill portfolio gaps,
reduce costs, or deliver a long-standing active investment
approach, the new T. Rowe Price
active ETFs will extend our capacity to meet client needs. We are
grateful to the SEC and the NYSE for their roles in getting us to
this point."
T. ROWE PRICE ETFS' PATH TO APPROVAL
- T. Rowe Price has been engaged
in constructive communication with the SEC about the potential
launch of semitransparent active ETFs for several years, having
initiated dialogue in 2010 and submitted its first private filing
in 2011.
- In 2013, T. Rowe Price applied
to the SEC for exemptive relief to bring to market actively managed
equity ETFs with a less frequent holdings disclosure policy than
what is currently required for transparent ETFs.
- Since that application, T. Rowe
Price has had constructive dialogue with the SEC, resulting
in the amendment of their application several times over the past
few years in response to SEC comments.
- On December 10, 2019, the SEC
granted exemptive relief to the firm's version of active ETFs; the
following day, the NYSE Arca filed for 19b-4 trading approval on behalf of T.
Rowe Price, coinciding with T.
Rowe Price's filing of initial
prospectuses with the SEC.
ABOUT T. ROWE PRICE
Founded in 1937, Baltimore-based T. Rowe Price Group, Inc.
(NASDAQ-GS: TROW), is a global investment management organization
with $1.19 trillion in assets under
management as of May 31, 2020. The
organization provides a broad array of mutual funds, subadvisory
services, and separate account management for individual and
institutional investors, retirement plans, and financial
intermediaries. The organization also offers a variety of
sophisticated investment planning and guidance tools. T.
Rowe Price's disciplined, risk-aware
investment approach focuses on diversification, style consistency,
and fundamental research. For more information, visit
troweprice.com, Twitter, YouTube,
LinkedIn, Instagram, or Facebook.
T. Rowe Price Investment Services, Inc.
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SOURCE T. Rowe Price Group, Inc.