As advisors explore 2026 ETF Trends, Exchange presented a session covering top-of-mind stories. The session featured members from Women in ETFs, that inlcuded J.P. Morgan’s Julie Abbett, American Century Investments’ Cleo Chang, Fidelity Investments’ Lubna Lundy, and moderator Roxanna Islam from VettaFi, who unpacked the state of ETF markets in 2026.
The ETF industry has expanded beyond simple beta. Active ETFs are launching at three times the rate of passive ones, benchmarks are getting smarter, and the “wrapper revolution” is democratizing everything from crypto to complex derivative income.
Alpha is the Omega
Asked about how to think about alpha for active management, Chang said it is about going above and beyond. “We can all do a better job speaking to advisors and trying to achieve and then aim to overachieve.”
Abbet added, “The conference is happening at an important time,” sharing that AI is impacting investing in huge ways, including helping to inject more juice and earn more alpha in asset management strategies.
“Today its about finding smarter, more consistent ways to deliver beyond traditional active management,” said Lundy. She shared that in today’s volatile market, “managing downside risk is almost more valuable than picking winning stocks.”
ETF Share Class Shake Up a Big 2026 ETF Trend
With many mutual funds set to convert to ETFs, the ETF share-class shake-up is top of mind. “There can be some meaningful benefits for clients. The best way I heard it described was as a slow-moving avalanche,” Lundy said. Though she said a lot is going on in the market in general, so it might be the story of 2026, even though it is an important one.
Abbott noted that, “it forces traditional active managers to look at the ETF wrapper.”
Digital Assets a key 2026 ETF Story
At the end of 2025, there was a spike in the number of crypto ETPs entering the market. Lundy said there is demand for more digital asset diversification, and that 2026 could see some exciting developments in crypto.
Covered Calls and Defined Outcomes
Asked about covered call strategies, Abbott shared that clients sometimes prioritize yield and not total return. “I think these strategies are discovering unique ways to get income,” but cautioned that people need to think about what they actually need.
Thematics
Islam noted that though some investors are interested in crypto and thematic strategies, they tend to be “fairweather” fans. “The challenge is volatility,” Lundy said. High-beta investments in emerging technologies like AI and other industries are interesting to advisors, but they tend to be more satellite than core positions. “The ETF wrapper has made it easier to implement these strategies,” Ludy offered. “These strategies require thoughtful positioning and risk management.”
Product Differentiation
With 1000 products launched in 2025 and 300 new issuers, standing out is more challenging than ever. “There are more ETFs than publicly listed stocks,” Lundy said. ”In such a crowded space, [advisors]are looking for brands they can trust.”
Abbott noted that “performance is going to be a key differentiator.”
Closing Thoughts
In today’s challenging markets, Abbott thought it was important to remember that “the ETF share class is a defense.” Being at the forefront of new ideas is also important, and issuers need to consider globalization.
Lundy noted that there are continued expectations that AI will crack, but it hasn’t happened yet. “I do think there is a broadening of market leadership happening in the markets.” Geopolitical tensions are also impacting markets, according to Lundy.
Chang offered “the way we think about 2026 and beyond is really simple: keep doing the things we do.” She stressed delivering on your promises and never surprising clients. “That’s one of the most important things for asset managers – to be very clear and stick to your knitting.”
For more news, information, and analysis, visit VettaFi | ETF Trends.
Originally published on ETF Trends
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