New information made public on Tuesday indicates that consumers’ perceptions of the American economy have grown more pessimistic. According to the Conference Board, its consumer confidence index decreased from 104 in March to 101.3 in April. The index is still below the average value for 2022 of 104.5.
The board’s expectations index, which is based on consumers’ short-term forecasts for the state of the economy, their businesses, and the job market, also fell, from 74 last month to 68.1 this month. The expectations index has been below the mark corresponding to a recession within the next year every month since February 2022, with the exception of a small increase in December 2022.
Ataman Ozyildirim, senior director, economics at the Conference Board, said in a statement that the data shows that consumer “expectations fell and remain below the level which often signals a recession looming in the short-term.”
“Consumers became more pessimistic about the outlook for both business conditions and labor markets,” Ozyildirim added. “Compared to last month, fewer households expect business conditions to improve and more expect worsening of conditions in the next six months.”
With consumer confidence down and more investors expecting a recession on the horizon, it may be a good idea to look into active management.
Active ETFs can be a valuable tool for investors seeking alpha during volatile or bear markets. They can enable investors to adjust their portfolio holdings in response to changing market conditions. They can also help investors build a diversified portfolio that’s better suited to their investment goals and risk tolerance, and potentially generate higher returns over the long term than passive ETFs.
It should be noted, however, that not all active managers are created equal, and only a handful can provide alpha, regardless of market conditions. Active managers with greater resources and greater scope benefit from economies of scale, which can often translate to better returns.
As part of its lineup of active ETFs, T. Rowe Price offers a suite of actively managed equity ETFs, including the T. Rowe Price Blue Chip Growth ETF (TCHP), the T. Rowe Price Dividend Growth ETF (TDVG), the T. Rowe Price Equity Income ETF (TEQI), the T. Rowe Price Growth Stock ETF (TGRW), and the T. Rowe Price US Equity Research ETF (TSPA).
“Active managers can reposition the portfolio toward favored names when they are temporarily trading at lower levels,” said VettaFi’s head of research Todd Rosenbluth.
T. Rowe Price has been in the investing business for over 80 years and conducts field research firsthand with companies, utilizing risk management and employing a team of experienced portfolio managers carrying an average of 22 years of experience.