Vanguard founder Jack Bogle initially opposed ETFs, viewing intraday trading as speculation. Leadership overcame this by framing ETFs not as a trading product, but as an 'alternative distribution vehicle' to get their low-cost funds onto brokerage platforms and into advisors' hands, ultimately widening their market.

Contrary to intuition, even a fully systematic, rules-based investment strategy benefits from an active ETF structure. This approach avoids third-party index licensing fees and provides crucial flexibility to delay rebalancing during volatile market events, a cumbersome process for index-based funds.

To compete with behemoths like Vanguard, new ETFs must focus on boutique strategies that are too complex, differentiated, or capacity-constrained for trillion-dollar managers. Competing on broad, scalable market beta is futile; the opportunity lies in specialized areas where expertise and smaller scale are advantages.

Dimensional's late entry into ETFs (2020, despite being founded in 1981) was not an oversight but a choice driven by its distribution channel. Its core clients, fee-only financial advisors, initially preferred the simplicity and guaranteed end-of-day net asset value (NAV) pricing of traditional mutual funds.

The modern ETF landscape is characterized by issuers launching a high volume of specialized products, including leveraged single-stock and long-tail crypto ETFs. They accept that many will fail, hoping a few become highly profitable hits.

The stigma of managed accounts representing managers in dire need of assets has flipped. Now, successful PMs from top firms use them to launch their own businesses with strong, long-term capital partners, indicating positive selection.

Allspring CEO Kate Burke predicts the next evolution in wealth management will be "customization at scale." This involves leveraging technology to move beyond generic solutions like target-date funds and empower advisors to create highly personalized financial plans for every individual client.

Adding higher-fee private assets to existing low-cost target-date funds is a non-starter. The go-to-market strategy will be to create entirely new fund series. This presents a significant sales challenge, as employers must be convinced to actively move employee assets to the new, more complex products.

Around 2018, the surging demand for separately managed accounts (SMAs) was a key symptom of the "factory model." This structure allowed asset managers to accelerate fundraising by raising vast, simple pools of capital from institutional channels, prioritizing speed and scale.