Small-Caps, Bitcoin, and a Cathie Wood Buffer: 3 New ETFs — Barrons.com

By Paul R. La MonicaSmall-caps, crypto, and Cathie Wood. That trio caught the attention of top strategist Tom Essaye.Two are the themes of new exchange-traded funds. The other is a new ETF run by the savvy money manager Wood.Tom Essaye, editor of The Sevens Report newsletter, often takes a look at ETF launches and other actively managed funds in the news.On Wednesday, Essaye zeroed in on Wasatch Small/Mid Cap ETF, the T. Rowe Price Active Crypto ETF, and Wood's ARK DIET Q3 Buffer ETF-all launched in July.First, the Wasatch ETF. Essaye is intrigued because the Russell 2000 and S&P MidCap 400 indexes have outperformed the broader market all year long. The Russell 2000 is up 21% this year and the S&P MidCap 400 has gained 16%.The ETF charges an expense ratio of 0.75%, in line with industry standards for actively run funds.Wasatch is known for "high-quality, long-term growth" and "rigorous research" he wrote. Plus, that the fund's managers "emphasize strong financials, defensible business models, and first-rate management teams."Essaye thinks the management team has a knack for identifying companies with "outstanding long-term growth potential." Biotech Halozyme Therapeutics, Barron's stock pick SharkNinja and discount retailer Five Below are top holdings.OK, Essaye concedes that betting on Bitcoin may not be the greatest long-term investment strategy. But he still is fascinated by the T. Rowe Price Active Crypto ETF because T. Rowe Price is another legacy institution that is getting into crpto-just like a host of others, including Fidelity and Morgan Stanley.The crypto ETF charges an expense ratio of 0.75%.For Essaye, it's a good sign that T. Rowe Price's head of digital asset strategy is running the fund. Blue Macellari spent more than two decades with other top asset managers, including crypto hedge fund Dunamis Trading and Elliott Management, before she joined T. Rowe Price in 2022.Wood's new ETF takes advantage of two popular trends-buffered ETFs and the momentum/AI trade.The ARK DIET Q3 Buffer ETF uses options to cap potential downside for ARK's flagship ARK Innovation ETF, which has big positions in Elon Musk's Tesla and SpaceX as well as crypto firms Circle internet Group and Coinbase.Essaye said the buffer ETF is a good investment for anyone worried about stocks topping out, an AI bubble, or seasonal volatility, but still wants 'innovation.'"The fund has a slightly higher expense ratio of 0.89%, but that might be a reasonable price to pay for a strategy that has had its ups and downs. ARK Innovation tumbled 17% in the first quarter but is now up nearly 11% on the year.Write to Paul R. La Monica at [email protected] content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.