American Century builds $128B ETF business with Avantis

American Century Investments has built a $128 billion ETF business since entering the market in January 2018. The firm now offers nearly 50 exchange-traded funds and ranks among the top 20 U.S. ETF issuers by assets.

The firm launched its first ETFs in January 2018: the index-based American Century US Quality Value ETF (VALQ) and the actively managed American Century Diversified Corporate Bond ETF (KORP). VALQ holds $307 million and KORP holds $794 million.

The Avantis family, created in 2019 after Eduardo Repetto joined from Dimensional Fund Advisors, accounts for about $120 billion across more than 30 ETFs. Avantis funds use quantitative factor tilts toward lower valuations, higher profitability and smaller-cap exposure, combined with broad market coverage and incremental active adjustments. Leading Avantis funds include the Avantis U.S. Small Cap Value ETF (AVUV) with $25.6 billion, the Avantis Emerging Markets Equity ETF (AVEM) with $23.3 billion, the Avantis International Small Cap Value ETF (AVDV) with $18.7 billion, the Avantis International Equity ETF (AVDE) with $15.5 billion and the Avantis U.S. Equity ETF (AVUS) with $12 billion.

In late March 2020 American Century introduced the first semi-transparent actively managed ETFs in the U.S.: the American Century Focused Large Cap Value ETF (FLV) and the American Century Focused Dynamic Growth ETF (FDG). Those funds use a structure promoted by Precidian that publishes an intraday indicative value while full holdings are disclosed 15 days after each quarter end. FLV and FDG each hold more than $300 million.

The American Century-branded lineup is dominated by active management. Top funds in that brand include the American Century US Quality Growth ETF (QGRO) at $2.2 billion, KORP at $797 million, the American Century Diversified Municipal Bond ETF (TAXF) at $628 million and the American Century Quality Diversified International ETF (QINT) at $580 million. Fixed income ETFs under the American Century name are exclusively actively managed; firm executives state they seek to avoid index-weighted concentration in the most heavily indebted issuers through active management.

Sandra Testani, head of ETF product and strategy, described the lineup as “fairly broadly diversified in both investment styles.” She noted that at least 60% of American Century’s actively managed ETFs have traded for three years or more, compared with about 30% of actively managed ETFs across U.S. markets.

American Century’s ETFs have attracted more than $16 billion in net inflows this year, with most of the flows directed to actively managed products. Avantis funds often hold thousands of securities to capture factor exposures, while many American Century-branded equity ETFs hold several hundred positions.

The firm operates two separate ETF brands: the research-driven Avantis family and the American Century active lineup. Together they offer a range of quantitative, indexlike and traditional security-selection strategies to investors.