Wealth Management
Outcome-based ETFs, launched in 2018, have surged past $70 billion in assets under management as investors embrace structured approaches to manage risk and return. About 98% of assets are in buffer strategies ranging from 9% to 100%, primarily tied to the S&P 500 Index via FLEX options.
During April 2025’s market volatility, investors shifted heavily toward 15–40% buffers, signaling stronger demand for deeper downside protection. “Max buffer” or principal-protected ETFs, offering full downside coverage, have become the fastest-growing segment, with assets up over 45% year-to-date.
New entrants like Goldman Sachs Asset Management and McCarthy & Cox are innovating with dynamic reference assets and even bitcoin-linked outcomes.
Finsum: With more managers entering the space and product innovation accelerating, outcome-based ETFs are reshaping how investors approach portfolio construction.
The rise of artificial intelligence has sparked an unexpected boom in utility ETFs, driven by soaring electricity demand from power-hungry data centers supporting AI infrastructure. Funds like XLU, VPU, IDU, and FUTY have gained over 7% in the past year, outperforming the broader utility sector.
Data centers already consume about 1.5% of global electricity, with the U.S. accounting for nearly half, and the International Energy Agency projects this demand to double by 2030. This surge positions electric utilities as critical enablers of the AI revolution, creating a long-term growth runway supported by regulated rate increases and infrastructure expansion.
Investors have turned to utility ETFs as a way to gain exposure to companies powering the digital economy, particularly U.S. giants like NextEra Energy and The Southern Company.
Finsum: As AI adoption accelerates, utility ETFs stand to benefit from a sustained and predictable rise in electricity demand.
Bank of America is urging investors to focus on high-quality value stocks as markets show signs of overheating and sentiment shifts toward more defensive strategies. In its Small/Mid Cap Factors report, the bank noted that while small-cap value stocks lagged in the third quarter, they are now positioned for a rebound.
Analysts pointed to several signals suggesting stronger prospects for value stocks, including the U.S. Regime Indicator’s recent shift to a “Recovery” phase, historically favorable for value leadership.
The report also emphasized that value stocks tend to outperform during Federal Reserve rate-cut cycles, similar to the current environment. Bank of America highlighted that value has started to outperform in mid caps, even as growth stocks continue to rally, noting that the “low-quality rally is in its later innings.”
Finsum: Turning to fundamentals could be the play with rate cuts on the horizon and an shaky economy.
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The Vanguard Information Technology ETF (VGT) offers investors broad exposure to leading artificial intelligence (AI) companies at a very low cost, with an expense ratio of just 0.09%. While not an AI-specific fund, it tracks the information technology sector, which includes many of the world’s biggest AI players such as Nvidia, Microsoft, Apple, and Broadcom.
About two-thirds of the fund is concentrated in semiconductors and software, meaning its performance is closely tied to the success of a few dominant firms. Compared with AI-focused ETFs like Global X AIQ, which charges 0.68%, VGT’s low fee structure can translate into thousands of dollars in added returns over time.
However, its heavy concentration — nearly 45% in Nvidia, Microsoft, and Apple — makes it vulnerable to downturns in those key stocks. Overall, VGT provides a simple, low-cost way for investors to benefit from the AI boom without the challenge of picking individual winners.
Finsum: AI makes up a high percentage of GDP growth and this index fund could take advantage of this growing sector.
Rapid Growth and Popularity: Interval funds are gaining momentum, with 19 new launches through May 2025, on pace to surpass the 2024 record of 27. Assets under management have grown nearly 40% annually, reaching almost $100 billion as of April 2025.
Unique Structure and Flexibility: Unlike mutual funds, interval funds allow quarterly redemptions, offering a semi-liquid structure that enables managers to invest in less-liquid, higher-return opportunities like asset-backed securities or CLO equity.
Advantage in Volatile Markets: During market dislocations, interval funds can act as opportunistic buyers rather than forced sellers, taking advantage of discounted high-quality assets when others are liquidating positions, demonstrated during the COVID-19 sell-off in early 2020.
Finsum: This structure better aligns fund liquidity with long-term investments, and advisors should track the horizon for their clients
Public companies’ Bitcoin holdings jumped nearly 40% in Q3 2025, even as the cryptocurrency’s price stayed below $115,000. According to Bitwise, 172 firms now collectively hold about 1.02 million BTC—roughly 4.8% of total supply—driven by large additions from players like Strategy and Japan’s Metaplanet.
Despite this record accumulation, enthusiasm across crypto equities has cooled, with companies such as Metaplanet seeing share prices tumble more than 70% from their peaks.
Analysts suggest Bitcoin’s muted response reflects low market liquidity and the nature of institutional buying, which mostly occurs off exchanges and doesn’t immediately move prices. Broader macroeconomic uncertainty, from renewed trade tensions to shifting Fed policy expectations, has also dampened risk appetite.
Finsum: Many market observers remain optimistic, expecting Bitcoin to regain upward momentum once retail demand and liquidity return later in the year.