The primary reason Star Mutual Fund’s management company steered clear of ETFs in the past was the requirement for daily portfolio disclosures, which limited managerial activities. However, in recent years, prominent managers have increasingly turned to ETFs—perhaps they’ve become more comfortable with transparency or simply responded to rising investor demand for these investment vehicles. It’s noteworthy that active ETFs have attracted nearly $900 billion in new investments, in stark contrast to the over $2.3 trillion that active mutual funds have lost over the last five years.
Regardless of the initial hesitations, active ETFs seem to be firmly established now, with many leading managers embracing them. Among today’s featured ETF selections are past winners of the Morningstar Outstanding Portfolio Manager Award. This group includes well-regarded names like T. Rowe Price’s David Giroux, Oakmark’s Bill Nygren, and Capital Group’s Rob Loveless, along with his team. These ETFs combine the benefits of both effective management and the inherent advantages of the ETF structure.
Three Impressive Stock ETFs Managed by Outstanding Managers
- T. Rowe Price Capital Appreciation Stock ETF TCAF
- Oakmark US Large Cap ETF OAKM
- Capital Group New Geography Equity ETF CGNG
First up is the T. Rowe Price Capital Appreciation Equity ETF, ticker TCAF, which has earned a gold rating. Led by David Giroux, a three-time recipient of the Morningstar Allocation Manager of the Year award for his impressive Capital Appreciation fund, PRWCX, this ETF essentially extracts the stock components from popular allocation funds, applying the same stock selection methodology.
The ETF identifies companies without significant long-term pitfalls, such as poor management or unstable business models. The focus then shifts to firms with reasonable valuations but high potential for growth and performance adjusted for risk. Typically, this results in a tilt towards growth stocks, often with a consistent emphasis on the tech sector.
Since its launch in June 2023, the results for TCAF have been quite impressive. It outperformed its peers in the large blend category by 60 basis points through August of this year. A low fee of 31 basis points also bodes well for the long-term outlook of Giroux’s inaugural ETF venture.
The next ETF on the list is the gold-rated Oakmark U.S. Large Cap ETF, ticker OAKM. This strategy draws on the expertise of the Harris Associates team, spearheaded by the renowned value investor, Bill Nygren.
This ETF incorporates some intriguing elements from Harris’s two main offerings. It partly draws from the holdings of the Oakmark fund family, where Nygren has a remarkable 25-year history of uncovering undervalued stocks that perform well over time. While Oakmark typically holds 45-60 stocks, the ETF is likely to include only 30-40, somewhat akin to Oakmark Select, known for having around 20-25. Nonetheless, this new ETF specifically focuses on large-cap stocks, enhancing liquidity and capacity.
So far, Nygren has successfully transitioned his talent into the ETF space. OAKM has outperformed the Russell 1000 Value Index by almost 5 percentage points from its launch in December 2024 until August 2025. While this brief track record shouldn’t be the sole basis for judgment, it aligns well with our evaluation of Nygren and the processes supporting OAKM.
The last ETF to mention is the gold-rated Capital Group New Geography Equity ETF, ticker CGNG. This ETF mirrors the successful American Funds New World Mutual Fund, utilizing a multi-manager approach and the same experienced team of 11 industry veterans.
The success of the mutual fund can be attributed to its adaptable and conservative investment strategy. Beyond emerging market companies, managers also have the leeway to invest in developed markets deriving a significant portion of revenues from emerging regions, which, interestingly, often results in a less volatile portfolio. As an illustration, the top ten holdings include both typical emerging market stocks like Tencent and established firms like Microsoft and Airbus.
CGNG has outshined its average peer group since its launch in June 2024, and looking ahead, the seasoned team and distinctive approach towards emerging markets should keep it on a strong path.
As new crypto ETFs start to surface, now might be a good time for investors to prepare for what’s coming next.
