Bloomberg Businessweek

Trying to Make Active Funds Cool Again

Rachel Evans and Annie Massa

• Will investors flock to new funds that look more like ETFs?

• “Active ETFs unnecessarily blur the lines”

Daniel McCabe, chief executive officer of Precidian Investments, is trying to create a new kind of fund, one he thinks will help active money managers survive the unrelenting rise of exchange-traded funds. It’s been an uphill battle.

With $10 trillion in assets in the U.S., actively managed mutual funds are big business, but they’re losing market share. For years investor money has been flowing into ETFs, most of which passively replicate market indexes. Index ETFs had assets of $2

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