Inside MFS Active ETFs

Inside MFS® Active ETFs

Jamie Harrison, Head of ETF Capital Markets, explores the importance of ETF liquidity and how MFS focuses on multiple factors to try to deliver ETFs that offer reliable liquidity and cost-effective trading for clients.

ETF liquidity is a key factor that impacts both performance and investor confidence. At MFS, we understand that liquidity goes beyond just trading volume; it also includes the underlying assets and how easily they can be bought or sold without significantly impacting market prices.

We take a proactive approach in bringing liquid solutions to market by focusing on multiple factors. First, we focus on structuring our ETFs around highly liquid underlying assets, to help provide tighter spreads and better execution. The goal is to minimize transaction costs for our clients, allowing them to enter and exit positions efficiently.

Second, we partner with experienced market makers to facilitate smoother trading, even during times of market volatility. By fostering a deep liquidity pool, we seek to enhance price stability and protect investor returns.

Ultimately, it’s our goal is to maximize client value by delivering ETFs that offer reliable liquidity and cost-effective trading. At MFS, we continue to innovate and optimize, ensuring that our products align with the needs of today’s investors.  [END]

Important risk considerations: The funds may not achieve its objective and/or you could lose money on your investment in the fund. Exchange-Traded Funds (ETFs): trade like stocks, are subject to investment risk, and will fluctuate in market value. Shares of ETFs are bought and sold at market price, not NAV, and are not individually redeemed from the fund. The market price at the time of sale may be higher or lower than the fund’s NAV, and any applicable brokerage commissions will reduce returns. There can be no guarantee that an active market for the funds will develop or be maintained. Stock: Stock markets and investments in individual stocks are volatile and can decline significantly in response to or investor perception of, issuer, market, economic, industry, political, regulatory, geopolitical, environmental, public health, and other conditions. Bond: Investments in debt instruments may decline in value as the result of, or perception of, declines in the credit quality of the issuer, borrower, counterparty, or other entity responsible for payment, underlying collateral, or changes in economic, political, issuer-specific, or other conditions. Certain types of debt instruments can be more sensitive to these factors and therefore more volatile. In addition, debt instruments entail interest rate risk (as interest rates rise, prices usually fall). Therefore, the portfolio's value may decline during rising rates. Portfolios that consist of debt instruments with longer durations are generally more sensitive to a rise in interest rates than those with shorter durations. At times, and particularly during periods of market turmoil, all or a large portion of segments of the market may not have an active trading market. As a result, it may be difficult to value these investments, and it may not be possible to sell a particular investment or type of investment at any particular time or at an acceptable price. The price of an instrument trading at a negative interest rate responds to interest rate changes like other debt instruments; however, an instrument purchased at a negative interest rate is expected to produce a negative return if held to maturity. Derivatives: Investments in derivatives can be used to take both long and short positions, be highly volatile, involve leverage (which can magnify losses), and involve risks in addition to the risks of the underlying indicator(s) on which the derivative is based, such as counterparty and liquidity risk. High Yield: Investments in below investment grade quality debt instruments can be more volatile and have greater risk of default, or already be in default, than higher-quality debt instruments. International: Investments in foreign markets can involve greater risk and volatility than U.S. investments because of adverse market, currency, economic, industry, political, regulatory, geopolitical, or other conditions. Growth: Investments in growth companies can be more sensitive to the company's earnings and more volatile than the stock market in general. Concentrated: The portfolio's performance could be more volatile than the performance of more diversified portfolios. Value: The portfolio's investments can continue to be undervalued for long periods of time, not realize their expected value, and be more volatile than the stock market in general. Municipal Bond: Investments in municipal instruments can be volatile and significantly affected by adverse tax or court rulings, legislative or political changes, market and economic conditions, issuer, industry-specific (including the credit quality of municipal insurers), and other conditions. Because many municipal instruments are issued to finance similar projects, conditions in certain industries can significantly affect the portfolio and the overall municipal market.

 

Please see the prospectus for further information on these and other risk considerations

 

Before investing, consider the fund's investment objectives, risks, charges, and expenses. For a prospectus, or summary prospectus, containing this and other information, contact MFS or view online at mfs.com. Please read it carefully.

 

MFS® Fund Distributors, Inc., Member SIPC, 111 Huntington Avenue, Boston, MA 02199

 

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