高盛23亿美元收购ETF提供商Neos

What they recognize is what we see. And what the marketplace sees is that active ETFs are a new wave of of sort of a wrapper that investors and their clients are looking to invest through. And so I think that's what you see with Neos today, uh, is a specialized active ETF manager. Um, it's only $30 billion in assets. Right. So it's not necessarily a needle mover to the Goldman Sachs franchise that we know today. Um, but I think they see where the puck is moving in terms of client demand.

Uh, and I think that's why you see them building out this ETF franchise, this follows, uh, you know, maybe 18 or so months ago, they acquired Innovator Capital, which is, uh, another sort of active ETF provider of buffer ETFs that provide you, uh, capped equity upside exposure. And it, you know, caps the downside. Right. So they recognize that these sort of specialized sort of solutions based ETFs uh, are where the puck is moving are where investors are going.

And by the way, where flows are going. Right. You've seen pretty outstanding growth uh across the active ETF space. And so they're sort of positioning themselves to build out that franchise. When you think about active ETFs overall it's highly fragmented right. So there's lots of opportunities to take share. One way to do that is is by these really successful smaller managers. And that's what Goldman is doing here. Is there a reason why ETFs are so hot in this market.

Seems like everything's going up. What is the appeal of an ETF. Yeah I mean it comes down to the simple things of lower cost and a mutual fund tax efficiency. Daily liquidity uh investors like that. Advisors like that. Retail likes that. So there's a natural structural reason why those are winning. Uh, particularly when you think about active ETFs, if you were to chart the active ETF flows against active mutual fund flows, you're going to have two lines going in very different directions.

Um, so there is a little bit of uh, you could almost say cannibalization there for the asset managers where they see money leaving their legacy active mutual funds, uh, in lieu of some of those active ETFs, uh, these deals from Goldman, though they're not necessarily looking at, uh, you know, a large blend active ETF, a sort of exposure based ETF. These are much more specialized, uh, much more servicing. Uh, what we're looking for in the wealth channel of where you want, um, sort of personalized, uh, solutions.

All right. Being a former banker, I ran the valuation. I ran the numbers. I got my HP 12. See here. $32 billion in assets. Um, they paid $2.3 billion for it. So 7% of assets. Um, is that rich? Is that cheap, or is that in line with the market multiples? What is that? So it's it's in line with what they paid for. Innovator. A very similar, uh, franchise that they acquired. Uh, what is interesting, you noted the 7% of assets.

If you look at the broader world of asset management deals over call it the past decade, we're hovering around 1 to 2% of assets. So, yeah, 7% is a materially higher number. Uh, when you look under the hood, you can understand why, right? We look at, uh, the buffer ETFs that they bought with innovator, these option based ETFs that they're buying today with Neos. uh, you see average expense ratios, uh, 60, 70, 80 basis points.

Right? When you think of an ETF right off the hop, you're thinking of cheap beta, maybe less than ten basis points, right? Uh, so we're talking about a different animal here. Uh, and when you look at the growth, uh, we just talked about where the flows are going. It's active ETFs. Uh, these franchises have been growing, you know, 20, 30, 40, 50% annualized, um, over the past five years. Uh, and those those are being extrapolated moving forward as these products gain more proliferation, uh, and they become meaningful flow drivers.

So you see that in the valuation that they're paying today. We typically see these 7% or higher, even closer to 10% of assets reserved for private markets, which is, you know, the other pocket, uh, a much larger pocket. I'll mention in the asset management world, where fees are higher and assets are growing at a much faster clip than the mutual fund space. Uh, so you're seeing some, some higher multiples paid here. Why is why are people migrating away from mutual funds and into ETFs.

What do ETFs have that mutual funds don't? Yeah I mean I think it goes back again to some of those structural things we talked about. It's going to be a lower cost. Uh it's going to have more tax efficiency. Uh, and it's going to have that intraday liquidity which just makes portfolio management easier overall. So again those are the structural things. But we're starting to see more creative uh solutions type uh products here that Goldman's really getting into.

Uh, and you know, those are sort of the underlying drivers. Again, you can always point back to the fact that active mutual funds, on a broad basis, uh, have had trouble outperforming their benchmarks. Right. Uh, there's always a select few, um, that are. And that's where the flows tend to funnel towards, uh, but when you start looking at the broader universe, um, it's becoming more challenging, uh, to sort of justify the costs.

Uh, and so you see investors sort of shifting and voting with their dollars, that's really led to the rise of passive ETFs. But there's always a desire for some active and alpha. So here come active ETFs.