The New ETF: Combining Tax Efficiency with Active Insights

Discovering value and opportunity through innovation

In today’s investment world, investors have a range of ETF strategies to choose from. What makes Natixis ETF strategies unique? Natixis offers actively managed ETFs, strategies that expand upon the traditional benefits of passive ETF vehicles by integrating some of the industry’s most innovative and experienced active managers.

The result is low-cost, tax-efficient investment strategies built with the experience and expertise of managers like Harris Associates, Loomis, Sayles & Company, Vaughan Nelson, and Seeyond.

There are many passive ETF strategies that uncritically track an index. By contrast, Natixis ETFs are designed and operated by a global platform of independent, active investment managers who work to pursue growth opportunities and manage risk in all markets.

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Potential Portfolio Benefits of Active ETFs

Natixis builds upon the capabilities of the traditional ETF vehicle by incorporating a capacity for investment alpha1 through security selection. We provide transparent active ETFs – which disclose their holdings daily – as well as active semi-transparent ETFs. Active semi-transparent ETFs, a new innovation in the ETF space, are not required to disclose their holdings every day, which allows fund management teams to pursue their proprietary investment strategies beyond the purview of frontrunners, copycats, and competitors.

Potential Benefits of Active ETFs
  • Cost-conscious
  • Tax-efficient
  • Lower cash drag
  • Lower transfer agency fees
  • Intra-day trading
  • Preferred by younger investors2
  • May provide better utility than mutual funds in high frequency trading asset allocation models
  • Leverage the skills and experience of active fund managers

Growing Interest

In the coming years, financial advisors expect to increase their use of ETF strategies.3 This may be in part due to the tax efficiency of the ETF vehicle. Approximately 43% of all mutual fund assets are held in taxable accounts.4 Active ETF strategies can provide the same renowned research and know-how of active mutual fund managers – but at a lower cost and with fewer potential tax implications.

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Increasing Usage
  ETF arrowdown
Decreasing Usage
+20% ETFs -12%  Mutual funds
(including liquid alternatives)
+19% Separate accounts  -7% Money markets, deposit accounts, cash
+19% Alternatives
(excluding liquid alternatives)
 -5% Individual equities
+8% Other  -4% Variable annuities
+4% Other insurance products  -2% Individual fixed income

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