MFS Active ETFs: An Approach Backed by 100 Years of Experience

MFS’ Active ETFs: Approach Backed by 100 Years of Experience

Carol Geremia and Ted Maloney discuss our long history of active management, how we have evolved to meet client needs. They also talk about our decision to launch our suite of active ETFs and our active approach to managing them.

 

Carol: MFS's approach to active investing is to ensure that we offer choice and flexibility. And so today, we offer active ETFs along with our mutual funds, our SMAs, and our CITs. And the important point here is to provide packaging and pricing flexibility so that our advisors have the opportunity as they think about their end investor needs and the customization and personalization they want to bring to those investors' needs, that MFS can meet those demands with them.

We're really excited about the flexibility that we have available to advisors, and we think the active ETF is one more vital, important part of that menu of choice.

Ted: We take a deliberate approach before we make a strategic commitment to a new vehicle type or capability. We have been evaluating ETFs for over a decade and determined that we can deliver proven capabilities in an ETF structure to create long-term value for all clients.

As long-term demand for transparent active ETFs became clear in last couple years (based on ongoing dialogue with our clients), we made the decision to step into the space with conviction.

The same active investment philosophy that has fueled our success in mutual funds, SMAs and CITs drives our approach to ETFs. Our global investment platform has navigated many bull and bear markets, delivered competitive performance for clients. The foundation of our investment platform is built on:

• experienced investment teams sharing diverse viewpoints and debating ideas
• the discipline to invest for the long term rather than chasing short-term trends
• risk management that strives to deliver the highest return within the risk guidelines of each portfolio

Carol: It's no surprise that a hundred years later, after we introduced to the market the idea of the mutual fund back in 1924, that we're expanding on the idea of commingled vehicles, It wasn't just the commingled vehicle that was important. It was the attributes that made up the commingled vehicle, liquidity, transparency, and a diversified portfolio professionally managed for small investors.

A hundred years later, whether it's the mutual fund, the active ETF, the SMA, the CIT, those concepts are still so important to the end investor, to advisors to help them meet their long-term financial goals.

Important risk considerations: All investments carry a certain amount of risk including the possible loss of the principal amount invested. 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.
Actively Managed ETFs differ from traditional ETFs in that they do not seek to replicate or to track a specific index. As such, the ability of an Actively Managed ETF to achieve its objective will depend on the effectiveness of the fund’s Portfolio Manager.

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

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