Five ETFs to Watch in 2021
Exchange-traded funds—some low-cost and boring, others highly concentrated—that discerning investors should consider.
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Goldman Sachs Active Beta U.S. Large Cap Equity ETF (GSLC US Equity)
Goldman Sachs checks all the boxes with GSLC, its ActiveBeta U.S. Large Cap Equity exchange-traded fund. GSLC is low-cost, sophisticated, and overseen by a major Wall Street brand. GSLC is a “smart beta” ETF with the look and feel of an actively managed investment vehicle, but it’s packaged as a passively run product. The fund was set up to produce a low tracking error, meaning its composition and returns should mimic the S&P 500’s yet give it room to outperform its U.S. large-cap benchmark. That’s because GSLC screens out weaker-performing stocks, enhancing its viability as a core portfolio holding. GSLC packs a lot of punch at just a 0.09% expense fee, targeting undervalued companies with high-quality earnings. Other financial houses have been quick to follow the template for this $10 billion fund, including JPMorgan Chase & Co. and newcomer Dimensional Fund Advisors, which also seek to provide ETFs with active characteristics at little additional cost. —Athanasios Psarofagis