| | Good morning and happy Wednesday. Don't freak out. If you saw the recent returns of the AdvisorShares Psychedelics ETF (PSIL) and thought "maybe I'm hallucinating," you probably weren't (at least not by virtue of acknowledging the numbers, which objectively, are very high). Year to date, the $19 million ETF, which invests in biotech, pharma and life-sciences companies showing promise in psychedelic drugs, has returned about 77%. That's great news for anyone who's a recent investor in PSIL. But, as much as we hate to be downers, things don't look so great for investors who have been there since the beginning. Aside from 2025, the four-year-old fund has experienced steep losses every year since its inception, with annualized negative returns to date being over 31%, according to AdvisorShares' data. Remember, we warned you not to freak out. | | | | | | | | It's a wild idea — stocks with good reviews from analysts actually doing well — but hey, it just might work. VanEck is looking to the experts for its latest strategy. The firm filed this week for two funds that hold companies with positive outlooks from analysts. Roughly 80% of allocations in the VanEck MSCI EAFE Analyst Sentiment ETF and the VanEck MSCI EM Analyst Sentiment ETF will be directed toward companies with favorable forward estimates for cash flow, earnings per share, price targets and sales, along with upgrades in analyst recommendations, according to SEC filings. The funds track the MSCI Europe, Australasia and Far East index and the MSCI Emerging Markets index, respectively. "It will be interesting to see how the track record of these funds develops since it may act as a kind of scorecard for analysts covering the stocks in each index," said Zach Evens, a Morningstar manager research analyst. While fund managers often consider analyst sentiment as one of many inputs, Evens is unaware of any ETFs that explicitly and systematically allocate only to stocks with positive analyst sentiment. What's the Buzz? Analyst research plays a significant role in how investors interpret corporate performance, earnings prospects and valuation. While they don't change fundamentals, analysts' estimates do attempt to anticipate future performance. Stocks with the highest analyst sentiment scores have consistently outperformed those with the lowest scores over long periods, according to an MSCI study. The new funds also build on VanEck's earlier sentiment-based investing strategy. The firm's Social Sentiment ETF (BUZZ), whose holdings are determined by positive opinions expressed across blogs, news articles and online forums, is up more than 35% year to date. Allocations are capped at roughly 3% of the portfolio, and while many of its largest holdings are familiar names — Tesla, Palantir and Nvidia — GameStop remains among its top positions.   Trust Fall. There is, however, a lingering issue with analyst estimates. In 2003, the Global Research Analyst Settlement barred business-related communication between analysts and bankers at the same firm, without legal or compliance oversight. The goal was to keep analysts from cheerleading for their investment banker buddies' stock picks. But the SEC terminated the rule this month, arguing that its removal would "lower compliance friction."
Former SEC Chair Arthur Levitt warned that the move weakens investor protections. "Don't be fooled by the promise that other regulations provide this separation," he said in a Wall Street Journal opinion column. He added that regulators are already considering loosening analyst "quiet periods" — the time when they can publish research on their own bank's transactions — calling it "the natural pattern of regulatory surrender." Written by Griffin Kelly | | | | | | Many investors are increasingly turning to Exchange-Traded Funds (ETFs) for access to a variety of diversified exposures; in doing so benefiting from the transparency, tax efficiency and lower cost that ETFs provide. Goldman Sachs Asset Management offers actively managed options strategy ETFs that seek to meet the needs of investors. GPIX and GPIQ provide differentiated access combining diversified index exposure with an actively managed options strategy may offer lower volatility and a high level of consistent income. The Goldman Sachs Active ETFs give you access to decades of expertise and a relentless drive to help your clients achieve their desired outcomes. Learn more about the Goldman Sachs Premium Income ETFs.  | | | | | This was the year that State Street made private public. In the roughly nine months that the SPDR SSGA IG Public & Private Credit ETF (PRIV) has been trading, it has beaten its benchmark without attracting the level of flows that would make it a runaway success. At about $96 million in assets under management, it's at a size that the industry considers sustainable. The company's second such product, the State Street Short Duration IG Public & Private Credit ETF (PRSD), debuted in September and has since reached $90 million in assets. The funds have had a lot going for them. They are provided by one of the world's biggest ETF issuers, and the partner on the funds, Apollo Global Management, sources the private-credit investments and helps provide liquidity. But the liquidity demands of the ETF structure mean that their ability to hold private debt is limited, as illiquid investments can only account for 15% of the portfolio. The two State Street ETFs can have anywhere from 10% to 35% in the Apollo-sourced investments, and both currently allocate about 20%. Undoubtedly, that leaves investors craving pure private credit wanting more. But it also isn't the point, as the two are diversified bond funds. "They're both core bond holdings," said Matthew Bartolini, head of SPDR Americas research. "That's how investors should be looking at this." To Everything, Turn, Turn, Turn While private-credit ETFs offer unmatched liquidity, interval funds can provide more exposure to the asset class. For advisors and their clients who want to ride first-class on the private-credit train, that might be the ticket (though the ticket counter, or redemption window, is generally only open a few times a year). "If I am going to invest in private credit, I want to see a return profile that compensates clients for that reduced liquidity and potentially higher risk. There is a strong case to include this in a portfolio, as it has potential for returns that contribute to the bottom line and a somewhat diversified risk profile from equities," said Joe Boughan, founder of Parkmount Financial. "From what I have seen, the interval fund structure is a good middle ground." Asset managers have been eager to add private credit this year across product types: - JPMorgan filed in October for a Total Credit ETF that would allocate up to 15% of assets to private credit.
- Capital Group and KKR partnered on two public and private debt interval funds this year that so far have amassed over $500 million in assets.
- WisdomTree added a tokenized mutual fund, the Private Credit and Alternative Income Digital Fund.
Apples, Oranges, Chickens and Eggs: Comparing PRIV and PRSD to interval funds isn't fair, given the limitations of each wrapper and what the different funds set out to accomplish, Bartolini said. And what the firm is waiting for are the one-year anniversaries of the two ETFs, at which point they will have the minimum track records that some investors are looking for. Currently, PRIV is ahead of 92% of its peers (funds in Morningstar's intermediate core-plus category), Bartolini said. "This is a completely new and different approach to core bond allocation … Once we pass that critical one-year juncture, I think we'll see more interest." Written by Emile Hallez | | | | | | | | | Avantis Investors' first $100 billion didn't even take a century. The six-year-old firm, part of American Century Investments, is a recent success story in the rise of ETFs, particularly actively managed ones. Its growth has accelerated over the past year and a half, doubling its assets under management. Year to date, Avantis has seen about $28 billion in net new money, Chief Investment Strategist Phil McInnis said. "The biggest thing within the ETFs that's different this year is that we're seeing more adoption in a home office model," he said. Small Caps, Big Cash Over 90% of Avantis' assets under management are in its ETFs, and about 20% in just one product, the US Small Cap Value ETF (AVUV). That fund is up 9% this year, but the firm's next-biggest ETFs have been much stronger performers. Its $15 billion Emerging Markets Equity ETF (AVEM) is up nearly 30% year to date, while the $15 billion International Small Cap Value ETF (AVDV) is up about 46%. Further, its $11 billion International Equity ETF (AVDE) has returned 35%. Active management alone hasn't been the draw, as the company has also courted fee-conscious investors. AVUV, which is the second-largest fund in the category, behind Vanguard's passively managed $33 billion Small Cap Value ETF, has expenses of 25 basis points, compared with a category average of 35 bps, per VettaFi data. Part of the company's growth "is absolutely the vehicle," McInnis said. "The ETF is a more efficient vehicle than the mutual fund … [and] people appreciate what we bring to the table," he added, citing the company's costs, strategies and the services it provides to advisors. American Century has become the fourth-biggest active ETF issuer, thanks mostly to Avantis: - AVUV, AVEM and AVDV are the ninth, 13th and 15th-largest actively managed ETFs in the US market, per VettaFi.
- The Avantis International Equity and US Equity ETFs, at $11 billion and $10 billion, are the 22nd and 23rd largest.
- Industrywide, 86% of ETF launches in 2025 were actively managed, and $378 billion flowed into the category year to date through October, representing 35% of all ETF sales, per American Century.
Will the Real Avantis Please Stand Up? Lest there be any confusion, these numbers are all about the American Century-owned asset manager. They are not about Peoria, Illinois-based Avanti's Ristorante, nor do they reflect classroom technology firm Avantis Education. Most importantly, though, the story isn't about leveraged crypto-traded platform Avantis. Last week, American Century filed a lawsuit against that particular Avantis, claiming trademark infringement, according to a report by the Kansas City Business Journal. Who knew it was such a popular name? Written by Emile Hallez | | | | | | | | | |
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Keep a civil tongue.