Sometimes less really is more.

In the case of the relatively new world of 351 exchange ETFs, it’s a matter of $1 million or more versus just $150,000. That latter is the new minimum Alpha Architect this week announced for its upcoming US Equity 2 ETF (AAEQ), which is slated to begin trading before the end of the year. But to be more precise, it’s the minimum available to Schwab-custodied accounts. Fidelity clients aren’t so lucky, as the minimum for them is currently $5 million. And it’s generally $1 million for everyone else.

“Because this 351 process is new, some custodians are better at it,” Alpha Architect president Ryan Kirlin said, pointing out that it can take as little as 20 minutes to set up the transfer from Schwab to US Bank, the custodian for the forthcoming ETF. “On other platforms it’s a longer, more arduous process, and therefore we have to move the minimums. It’s a matter of time.”

The Invisible Tax Man

The 351 exchange, which is different from exchange funds, allows investors to move diversified stock holdings to certain ETFs without causing the capital gains to be taxed. Such a move happens before an ETF actually launches, though they remain open to other investors afterward, without the 351 exchange benefit. The strategy has gotten attention from academics and Congress as an alleged tax loophole, though 351s have been picking up steam this year.

For example:

• Alpha Architect’s US Equity ETF (AAUS), which launched in July, represents nearly $500 million.
• Cambria Investment Management, which has launched three 351 exchange ETFs, attracted $150 million for the Global EW ETF (GEW) before it started trading in September. Like Alpha Architect, Cambria has indicated that it intends to decrease investment minimums in the future, to as low as $100,000. Cambria also has a 351 ETF slated to launch in December.
• Lowering the investment minimums so substantially could increase the number of investors who use 351s.

“I have already done one 351 exchange for clients and I am looking at doing more,” said David Haas, owner of Cereus Financial Partners. “It could be very useful if minimums were lowered and if additional fund companies supported it.” Another advisor, Alex Caswell, founder of Wealth Script Advisors, said he has been considering the strategy for some clients, though the rules for 351 exchanges are complicated, and the option is not right for everyone. “This particularly works well for clients that have really messy portfolios as a result of a direct index that is locked up for the purpose of tax loss harvesting,” he said.

Tax or Treat: ETF issuers have to bring a new fund to market every time they plan to do a round of 351 exchanges. But that doesn’t mean the strategies won’t be useful for other investors afterward, Kirlin said. A challenge for AAUS is competing with the likes of the iShares Core S&P 500 ETF (IVV) and Vanguard S&P 500 ETF (VOO) while charging 0.15%, but a selling point of the Alpha Architect fund is that it minimizes dividend payments, he noted. “We do think in time the strategy will be recognized.”

The grass is always greener on the other side of the fence, and now T. Rowe Price’s bighorn sheep is exploring it.

The $1.7 trillion asset manager wants to bring an actively managed crypto index ETF to market, according to a Securities and Exchange Commission filing. The behemoth firm’s willingness to enter the nascent crypto market, expanding beyond its traditional, mutual fund roots after almost two years of spot crypto approvals, marks a big step in the acceptance of decentralized finance by legacy mutual fund providers. The fund’s numerous potential holdings also makes it unique: It would hold anywhere from five to 15 coins and aim to outperform the FTSE US Listed Crypto Index.

“[T. Rowe Price] follows a bunch of legacy firms that are already in [crypto], but what’s interesting about theirs is that it’s an index,” said Tyrone Ross, CEO of 401 Financial and Turnqey Labs. “It’s actively managed, you get broad exposure, and it’s from an almost 100-year-old name. That’s a big deal.”

Rowe, Rowe, Rowe Your Crypto Boat.

T. Rowe’s filing comes on the heels of other legacy firms launching their own funds for the first time. Tweedy, Browne, launched its first ETF, COPY, late last year, with others, including Lazard and Praxis, following suit. Meanwhile, BlackRock and Franklin Templeton continue to push for tokenization. The trend is a result of both rampant bleeding across the mutual fund class and an increasingly deregulated crypto environment, Ross said. “It’s one of those things where the regulatory skies have cleared,” he said. “A legacy name, I think that’s going to attract a lot of institutional capital.” A T. Rowe Price spokesperson declined to comment.

Other traditional mutual fund providers that launched ETFs this year include:

• Parnassus, which launched its Parnassus Core Select ETF (PRCS) and the Parnassus Value Select ETF (PRVS) in late 2024.
• First Eagle, which also brought its First Eagle Global Equity ETF (FEGE) and First Eagle Overseas Equity ETF (FEOE) to market late last year.

Crypto? I’ll Pass. Still, there are some notable holdouts, namely Vanguard and Charles Schwab, that have yet to launch their own crypto funds. Schwab said it plans to offer spot bitcoin trading in the first half of 2026, but Vanguard executives have for years spoken out against cryptocurrencies, with former CEO Tim Buckley telling CNBC in 2018 that Vanguard would “never” launch a bitcoin fund. But the future is less certain. “I’m in the camp that I don’t see Vanguard doing it,” Ross said. “But money is a powerful thing.”

Geneva-based Pictet Group is bringing its investment chops to the US ETF market, launching three products and hiring a Goldman Sachs vice president to build out distribution among RIAs.

Pictet Asset Management’s US funds, which lean on AI and thematic strategies, started trading Oct. 15. Although the company has long covered the US market and has managed pension assets and been a subadvisor, the ETFs are the first widely available investments in the country in Pictet’s 220-year history.

“Our clients are asking for them,” Pictet Asset Management CEO Elizabeth Dillon said. “ETFs are the vehicle of choice right now. Everyone wants ETFs.”

Let the Right One In

Of course, asset managers very much want in on the US ETF market, and numerous companies that waited for years have recently added their first such products. It’s an increasingly crowded space, making distribution strategies more important than ever. Just after its first three US ETFs launched, Pictet announced that it hired former Goldman Sachs Asset Management ETF specialist Benjamin Becker as its head of US ETF distribution.

“Our go-to-market strategy has very much to do with Ben Becker and the reason we hired him, which is to grow the ETFs via the RIA segment, which he will be leading,” Dillon said. Wirehouse distribution will be important, but firms may require performance histories and higher assets under management, she noted. Along with the three funds that launched, Pictet has two others planned to go live in the first quarter of 2026: the Emerging Markets Rising Economies ETF (RISE) and Emerging Markets Debt ETF (EMFI).

The ETFs at a glance:

• Pictet AI Enhanced International Equity ETF (PQNT), which uses a “factor-neutral AI model,” according to the firm.
• Pictet Cleaner Planet ETF (PCLN), which will invest in sectors “from efficient supply chain to smart grids to digital enablers.”
• Pictet AI & Automation ETF (PBOT) “provides disciplined, research-driven exposure to companies positioned to benefit from the ongoing adoption of AI and automation technologies … while avoiding momentum-driven investing pitfalls.”

New, to You: All of the ETF strategies are related to existing ones at Pictet, such as the megatrends and thematic franchises that are part of the company’s $800 billion assets-under-management global business. “There’s such a long history and presence of these strategies,” Dillon said. “We’re the OGs of themes.”