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Most active ETFs are derivatives-based or factors-based (semi-active) with the old-fashioned stock-picking left for the active mutual funds. Morningstar may have to create 2 categories of "Active" - Active-Derivatives-based & Active-Stock-picking. https://www.morningstar.com/funds/will-active-etfs-outnumber-passive-etfs
I'd skipped over this piece because of its title: Will Active ETFs Outnumber Passive ETFs? I don't care. As the article states, number of funds does not equate to AUM, i.e. market share.
Though as you point out, the piece goes into how these funds invest: what you describe as factor-based, what M* says is like smart beta.
M* changed its terminology from "smart beta" to "strategic beta". Either way, IMHO both monikers have it backward, i.e. these are "dumb beta" or "mechanical beta" approaches. Some factors are identified and weighted and then applied mechanically. That's a static approach, not an active one. Regardless of how it is marketed.
As a point of comparison, quant funds build models also. But unlike smart beta (or factors-based if you prefer), they are continually being updated to adapt to evolving markets. There's at least a little "activity" here.
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Though as you point out, the piece goes into how these funds invest: what you describe as factor-based, what M* says is like smart beta.
M* changed its terminology from "smart beta" to "strategic beta". Either way, IMHO both monikers have it backward, i.e. these are "dumb beta" or "mechanical beta" approaches. Some factors are identified and weighted and then applied mechanically. That's a static approach, not an active one. Regardless of how it is marketed.
As a point of comparison, quant funds build models also. But unlike smart beta (or factors-based if you prefer), they are continually being updated to adapt to evolving markets. There's at least a little "activity" here.