“ETFs are a central piece of our long-term strategy for Europe.” The statement comes from Julie Gunts, Head of ETF Strategy & Partnerships at AllianceBernstein, in an exclusive interview with Funds Society. The firm recently entered the European active ETF market with the launch of three fixed-income strategies, and the plan is to continue expanding its capabilities at a steady pace, as Gunts confirms: “We plan to continue expanding our UCITS ETF range over time, guided by client demand, market needs, and the areas where we believe AB can deliver truly differentiated solutions.”
AllianceBernstein already has an active ETF platform distributed across the United States, Asia (Taiwan), and Australia, with 18 billion dollars in assets under management. “Our primary focus is on building a high-quality, long-term ETF business rather than setting a specific short-term asset target. We believe that if we continue delivering differentiated and compelling strategies that resonate with clients, assets will follow over time,” the executive explained.
AllianceBernstein has recently entered the European active ETF market. Why did you choose active fixed-income ETFs as your entry point?
Fixed income felt like a natural starting point for our active ETF offering in Europe, driven by clear client demand and interest in accessing these strategies through an ETF structure. The initial products are designed as core fixed-income building blocks, providing efficient and diversified exposure to corporate bond markets while seeking attractive and repeatable sources of additional active return, with a risk profile broadly aligned with benchmark indices. These strategies are supported by AllianceBernstein’s systematic fixed-income platform, backed by more than 20 years of proprietary data, predictive technology, and deep analytical capabilities.
That said, fixed income is only the beginning. The launch of our ETFs in Europe represents the first phase of building a broader regional ETF offering over time, supported by continued investment in local resources. With the imminent launch of two active equity ETFs, we are continuing to expand the platform to provide clients with a broader range of active solutions in ETF format, reflecting growing demand for active exposure across different asset classes and reinforcing our long-term commitment to the European ETF market.
AllianceBernstein already has four years of experience marketing active ETFs in the United States, Australia, and Taiwan. What lessons have you learned from that experience?
In the United States, Australia, and Taiwan, investors use our active ETFs in different ways, ranging from core portfolio building blocks to income-generation solutions and thematic allocations.
One of the key lessons has been seeing that investors increasingly expect active strategies to be available through flexible and easy-to-use vehicles. Another important point is that ETF adoption varies significantly across regions, reinforcing the importance of adapting products to local market needs rather than applying a uniform global strategy. This is especially relevant in Europe, where markets such as Iberia start from different levels of ETF adoption.
What kind of feedback are you receiving from your European clients?
The response has been very positive so far. We have been discussing our plans to launch active ETFs in the European market with clients for quite some time. We have observed that client demand for ETFs has accelerated, as investors use them for both strategic and tactical allocations. This has fueled rapid growth in the European ETF market.
In our conversations with European clients, including those in Iberia, we see that investors value specific ETF advantages such as improvements to core portfolio building blocks, differentiated satellite exposures, real-time price transparency across asset classes, and new solutions delivered through an efficient structure. At the same time, in markets such as Spain, ETFs are often considered alongside existing mutual fund allocations rather than as a replacement for them. As a result, our goal is to expand the ways in which we deliver AB’s capabilities within this framework.
Are European investors demanding active ETFs only for cost reasons?
Cost is certainly one factor, but it is far from the only driver. European investors are attracted to active ETFs because of their transparency, liquidity, ease of access through brokerage platforms, and suitability for digital investment models.
In markets such as Spain, where mutual funds remain widely used, these characteristics are often valued alongside existing structures, and ETFs are viewed as a complementary tool rather than purely as a low-cost alternative. We are fully aware that fees matter, especially in the ETF space. Our goal is to offer competitive pricing while maintaining high-quality active management and analytical capabilities, with a value proposition and outcomes that are meaningful to our clients.
In markets such as Spain, where investors often compare ETFs with actively managed mutual funds, the focus is also on delivering value in terms of the role they play within portfolios and the outcomes achieved, not solely on nominal cost.
AllianceBernstein is widely known for its active investment philosophy. How do active ETFs fit within this approach?
Active ETFs are a very natural extension of the active investment philosophy that AB has developed over decades. Our ETFs are manager-led and supported by fundamental research, with portfolio management teams responsible for security selection, portfolio construction, and risk management.
The ETF structure does not replace active management; it improves the way it is distributed, combining AB’s investment capabilities with greater transparency, intraday liquidity, and operational efficiency. For investors in markets such as Spain, this provides an additional avenue to access active management alongside traditional fund structures.
What criteria do you use to determine where it makes sense for AB to offer ETF structures to clients?
For us, innovation must have a clear purpose. ETFs are not about repackaging everything we already do, but rather about responding to specific client needs through the most appropriate structure.
We carefully analyze where the ETF structure genuinely adds value, whether in terms of accessibility, flexibility, transparency, or distribution reach. Any strategy we launch must make sense alongside our existing fund range and complement it, especially in regions such as Iberia, where mutual funds continue to play a central role in portfolio construction.
In some cases, this means launching new outcome-oriented strategies directly in ETF format. In others, it may involve offering an ETF share class for an existing strategy when there is clear client demand. Conversely, there may also be strategies for which offering an ETF share class simply does not make sense.
More broadly, our global ETF strategy is guided by client preferences and usage trends in each local market, ensuring that launches are both relevant and complementary.
Are U.S. investors showing interest in UCITS active ETFs?
Our active ETFs in the United States are domiciled there and are not structured under the UCITS framework. In addition, our global strategy is to offer solutions aligned with local preferences and client needs. If we look at our global ETF offering across Taiwan, Australia, and the United States, there are always products specifically designed for each local market.
That said, in the United States there is also a segment of investors who invest through offshore structures, such as international accounts or vehicles, where UCITS products may be relevant.
More broadly, we are seeing interest in our UCITS ETF platform from investors across Europe, including Iberia, as well as in regions such as Latin America and Asia, where UCITS vehicles are often the preferred structure for cross-border investments. This highlights the importance of having a global ETF platform capable of adapting to different regulatory frameworks and investor preferences.
How do you think the active ETF universe will evolve over the next five years?
We believe active ETFs will coexist with traditional active mutual funds rather than completely replacing them. Different clients have different needs, and each vehicle is better suited to specific use cases. Over time, we expect active ETFs to play an increasingly important role, especially as distribution continues shifting toward digital and brokerage platforms.
For asset managers, this means offering choice: delivering strong active management capabilities through the structure that best fits client needs.
