The Active ETF Opportunity: Rethinking How Strategies Are Built and Delivered

If one trend defines the ETF landscape in 2026, it’s the accelerating rise of active strategies.

Once dominated by passive exposures, the ETF market is now seeing a clear shift that is redefining product development, investor demand, and competitive dynamics. Active ETFs are no longer an emerging category. They are becoming the focal point of growth for many ETF managers.

In the United States, active strategies now account for the majority of new ETF launches, signaling a shift in product priorities across the industry. Barriers to entry have lowered significantly. In late 2025, the SEC granted exemptive relief allowing asset managers to offer both mutual fund and ETF share classes within a single fund vehicle, breaking a 20-year exclusivity period previously held by Vanguard.

Unlike index-based ETFs, active ETFs aren’t bound by preset rebalancing schedules or index concentration. That flexibility can help ETF managers respond to new information faster to manage exposures as conditions change and pursue the fund’s stated investment objectives in a disciplined manner. They may also provide cost and after-tax advantages versus comparable mutual funds, while still offering active security selection and risk-aware portfolio construction.

Unlike index-based ETFs, active ETFs aren’t bound by preset rebalancing schedules or index concentration.

This is driving asset managers to rethink how strategies are designed and delivered. Active ETFs introduce new complexities over passively managed products, requiring access to real time order taking activity for create/redeems, inventory access for income negotiated baskets, and a connected ecosystem to communicate the updates to that data set throughout the trading day. Without the right technology and infrastructure, launching or converting strategies into active ETFs introduces new workflows and dependencies that can increase costs and slow time to market.

For many firms, the challenge is not whether they can bring active strategies into an ETF wrapper, but whether they can do so without disrupting existing processes. Beyond product innovation, the real challenge is how firms operationalize active strategies at scale.

Without the right technology and infrastructure, launching or converting strategies into active ETFs introduces new workflows and dependencies that can increase costs and slow time to market.

Supporting that shift requires technology that can evolve alongside the changing role of ETFs. Charles River provides ETF issuers with end-to-end investment lifecycle support, bringing portfolio management, trading, and ETF-specific workflows into a single, scalable environment. With real-time visibility into primary market activity and seamless integration with State Street ETF servicing, firms can manage ETFs alongside other strategies while maintaining efficiency as they grow.

The ETF managers that succeed will be those that can align portfolio strategy with scalable execution as ETFs continue to redefine the foundation of investing.

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Source: State Street, 2026 Global ETF Outlook: From Wrapper to Backbone, 2026.