This is an actively managed fund that targets US small- and mid-cap stocks within the Russell 2500 Index universe. Through bottom-up analysis, it identifies companies with differentiated business models and solid financial structures.

It suits investors who want exposure to the growth potential of the US small- and mid-cap market while benefiting from professional stock selection.

Launched in 2024 by Rockefeller Asset Management, the ETF uses an active management approach.

The fund focuses on companies' long-term fundamentals rather than short-term market swings. It builds its portfolio by selecting high-quality companies with competitive advantages and sustainable cash flows, and it pursues flexible diversification that is not confined to any particular sector.

• An active strategy that reflects the Rockefeller family's investment philosophy
• A concentrated portfolio built on strict quality criteria

Assets under management (AUM) stand at $724.8M, and the expense ratio is 0.75% per year.

Unlike passive ETFs that simply track an index, the skill of the portfolio manager matters here, and the fee level reflects the nature of an active fund.

Since its recent launch, the fund has shown volatility driven by the recovery in the small- and mid-cap market and the earnings momentum of individual holdings. It tends to react sensitively to the economic cycle and the interest rate environment.

As interest in active small- and mid-cap strategies grows, gradual inflows have been observed. In particular, a market environment with rising preference for quality stocks is working in its favor.

Its strength lies in generating alpha through professional stock selection, but investors should consider the active management fee and the high volatility typical of small- and mid-cap stocks.

BLCR, EAGL and AVLC, which are compared in the table, are similar ETFs that use large-cap-focused active strategies, and they differ from RSMC in the market capitalization of their investment targets. On the other hand, if you want to focus on the small- and mid-cap market while tracking an index, low-cost passive products such as IWM or IJH can serve as alternatives. In addition, SMMD, which directly tracks the Russell 2500 Index, and IWN, for those who prefer a value style within small- and mid-cap stocks, are also worth considering.

The Rockefeller US SmallMid Cap ETF combines the characteristics of active management with the high volatility of the small- and mid-cap market. Before making an investment decision, it is therefore necessary to closely review the fee structure, management performance, and the competitiveness of the major holdings.

There is management risk that active results may lag the market index. Moreover, during an economic downturn, small- and mid-cap stocks may fall more than large caps.

It is a suitable choice for investors who want small- and mid-cap exposure through professional stock selection rather than simple index investing. However, a long-term perspective that accounts for the higher fees and volatility is necessary.