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This New Actively Managed ETF Promises to Adjust Its Strategy to Favorable Industries

Tech stocks are hot buys this year but that wasn’t the case in 2022 when they were crashing. Real estate investment trusts might be good plays when interest rates come down, but when rate hikes take place is still a big question mark.

For investors, it can be a bit of a headache to keep track of what’s a good buy these days and what’s not. A new exchange-traded fund (ETF) that launched in March which can help investors with this is the Blackrock U.S. Industry Rotation ETF (NASDAQ:INRO). As the name suggests, it will rotate its holdings based on what is most favorable at the time. That means the fund is actively managed and does come at a higher cost – its expense ratio is 0.42%. While there are cheaper ETFs out there, that isn’t a terribly large cost compared to other actively managed funds.

It has 361 holdings and despite its focus on specific industries, it is well diversified with tech, communication, consumer discretionary, and industrials each accounting for at least 15% of the fund’s total holdings. Unsurprisingly, however, with tech being a hot place to invest, that makes up the bulk of its portfolio today. The top three stocks are all big names in tech – Microsoft (NASDAQ:MSFT), Nvidia (NASDAQ:NVDA), and Meta Platforms (NASDAQ:META). Together, they combined for approximately 20% of the fund’s total holdings.

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With some good diversification and reasonable costs for an actively managed fund, the Blackrock U.S. Industry Rotation ETF could be an attractive option for investors who want to be able to shift strategies without having to constantly monitor the latest stock market news.