Dec. 31, 2024 |
| T. Rowe Price U.S. Equity Research ETF
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| U.S. Equity
Research ETF
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Investment Objective(s)
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The fund seeks to provide
long-term capital growth.
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| Fees and Expenses
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This table describes the fees and expenses
that you may pay if you buy, hold, and sell shares of the fund. You may also incur brokerage commissions
and other charges when buying or selling shares of the fund, which are not reflected in the table or
example below.
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| Annual
fund operating expenses (expenses that you pay each
year as a percentage of the value of your investment)
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| Example
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| This example is intended to help you compare the cost of investing in the fund with the cost of investing
in other funds. The example assumes that you invest $10,000 in the fund for the time periods indicated
and then sell all of your shares at the end of those periods, that your investment has a 5% return each
year, and that the fund’s fees and expenses remain the same. Although your actual costs may be higher
or lower, based on these assumptions your costs would be:
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| Portfolio Turnover
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Portfolio Turnover The
fund pays transaction costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result
in higher taxes when the fund’s shares are held in a taxable account. These costs, which are not reflected
in annual fund operating expenses or in the example, affect the fund’s performance. During the most
recent fiscal year, the fund’s portfolio turnover rate was 43.5% of the average value of its portfolio.
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| Principal Investment Strategies
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The fund normally invests
at least 80% of its net assets (plus any borrowings for investment purposes) in U.S. equity securities.
The fund relies on MSCI Inc., a third-party provider of benchmark indexes and data services, or another
unaffiliated data provider to determine the country assigned to a security. Any derivatives that provide
exposure to the investment focus suggested by the fund’s name, or to one or more market risk factors
associated with the
investment
focus suggested by the fund’s name, are counted (as applicable) toward compliance with the fund’s
80% investment policy. The strategy attempts to create a portfolio with similar characteristics to the
S&P 500 Stock Index® (Index) with the potential to provide excess returns relative to the Index.
The fund uses a disciplined portfolio construction process whereby it weights each sector and industry
approximately the same as the Index. Within each sector and industry, the weighting of individual fund
holdings can vary significantly from their weighting within the Index. The fund attempts to outperform
the Index by overweighting those stocks that are viewed favorably relative to their weighting in the
Index, and underweighting or avoiding those stocks that are viewed negatively. A portfolio oversight
team, which includes the portfolio managers, is responsible for the overall structure of the fund and
for developing rules for portfolio construction. The portfolio oversight team seeks to take advantage
of T. Rowe Price’s fundamental research by assigning equity analysts to select stocks for the fund
within industries where they have focused expertise. The equity analysts are responsible for selecting
stocks and determining the stocks’ weights within their industry-specific portfolios, subject to the
oversight and discretion of the portfolio managers who work closely with the analysts. The
fund generally remains fully invested (less than 5% in cash reserves) and seeks to be sector neutral
when compared to the Index. While the majority of assets are invested in large-cap U.S. common stocks,
the fund may occasionally have some small- and mid-cap exposure in keeping with the fund’s objective. At
times, the fund may have a significant portion of its assets invested in the same economic sector, such
as the information technology sector. The fund is an actively-managed, exchange-traded
fund (ETF) that does not disclose portfolio holdings daily. In order to provide market participants with
information on the fund’s investments, the fund publishes a “Proxy Portfolio” on its website daily.
A Proxy Portfolio is a basket of securities that is designed to closely track the daily performance of
the fund’s portfolio holdings. While the Proxy Portfolio includes some of the fund’s holdings, it
is not the fund’s actual portfolio. The Proxy Portfolio could be based on a broad-based securities
index or the fund’s recently disclosed portfolio holdings. The fund’s Portfolio Overlap is available
on the fund’s website daily. The Portfolio Overlap is the percentage weight overlap between the holdings
of the prior business day’s Proxy Portfolio compared to the holdings of the fund that formed the basis
for the fund’s calculation of net asset value (NAV) at the end of the prior business day.
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| Principal
Risks
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Risk Table - T. Rowe Price U.S. Equity Research ETF
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Risk [Text Block] |
| Risk Lose Money [Member] |
The fund’s share
price fluctuates, which means you could lose money by investing in the fund.
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| Proxy portfolio structure |
Proxy
portfolio structure: The fund does not disclose portfolio holdings daily. The fund uses a Proxy Portfolio,
which is a basket of securities that is designed to closely track the daily performance of the fund’s
portfolio holdings. The fund may not always effectively construct a proxy portfolio that closely tracks
the daily performance of the fund’s portfolio holdings. Because the fund uses a Proxy Portfolio, there
is a risk that the fund’s shares may trade at a wider bid-ask spread than shares of ETFs that disclose
their portfolio holdings daily. This risk is heightened during periods of market disruption and volatility,
and, therefore, may cost you more to trade. Although the fund seeks to benefit from keeping its portfolio
information confidential, other traders may attempt to use the Proxy Portfolio and publicly available
information, including intraday net asset value (INAV) to identify the fund’s trading strategy, which,
if successful, could result in such traders engaging in certain predatory trading practices that may
have the potential to harm the fund and its shareholders. Because the fund’s shares are traded in the
secondary market, a broker may charge a commission to execute a transaction in shares, and you may incur
the cost of the spread between the price at which a dealer will buy shares and the somewhat higher price
at which a dealer will sell shares.
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| Premium/Discount |
Premium/Discount: Although the Proxy Portfolio is intended
to provide investors with enough information to allow for an effective arbitrage mechanism that will
keep the market price of the fund at or close to the underlying NAV per share of the fund, there is a
risk (which may increase during periods of market disruption or volatility) that market prices will vary
significantly from the underlying NAV per share of the fund. These price differences may be greater for
this fund compared to ETFs that disclose portfolio holdings daily because it provides different portfolio
holdings information to traders. The adviser will monitor on an ongoing basis how shares trade, including
the level of any market price premium or discount to NAV and the bid-ask spreads on market transactions.
Each day, the website provides the fund’s Tracking Error, which means the standard deviation over the
past three months of the daily proxy spread (i.e., the difference, in percentage terms, between the Proxy
Portfolio’s per share NAV and that of the fund at the end of the trading day).
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| Trading halt |
Trading halt: It
is possible that an active trading market for the shares will not be maintained, or that trading in the
shares will be halted for reasons such as market-wide trading halts or the shares no longer meeting the
listing requirements of the listing exchange. If securities representing 10% or more of the fund’s
portfolio do not have readily available market quotations, the fund would promptly request the listing
exchange to halt trading on the fund. In addition, to the extent T. Rowe Price determines that a security
held in a fund’s portfolio but not in the Proxy Portfolio does not have readily available market quotations
and such circumstance may affect the reliability of the Proxy Portfolio as an arbitrage vehicle, that
information, along with the identity and weighting of that security in the fund’s portfolio, will be
publicly disclosed on the fund’s website.
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| Authorized Participant |
Authorized Participant: The fund’s shares
may have a limited number of active “Authorized Participants,” which are financial institutions that
are able to transact daily with the fund to purchase and redeem a large specified number of shares of
the fund. To the extent they cannot or otherwise are unwilling to engage in creation and redemption transactions,
and no other Authorized Participant steps in, shares of the fund may trade at a significant discount
or premium
to
NAV and may face trading halts and delisting from the exchange. During times of market stress, Authorized
Participants may be more likely to step away from an ETF that does not disclose holdings daily than a
traditional ETF.
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| ETF shares trading |
ETF shares trading: Shares of the fund are listed for trading on a national securities
exchange and are bought and sold in the secondary market at market prices. The market prices of shares
are expected to fluctuate in response to changes in the fund’s NAV, the value of the fund’s holdings,
and supply and demand for shares. Disruptions to creations and redemptions, significant market volatility,
potential lack of an active trading market for the shares (including through a trading halt), or other
factors may widen bid-ask spreads and result in the shares trading significantly above (at a premium)
or below (at a discount) to NAV or to the value of the fund’s holdings. If a shareholder purchases
shares at a time when the market price is at a premium to the NAV or sells shares at a time when the
market price is at a discount to the NAV, the shareholder may sustain losses.
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| Market conditions |
Market conditions:
The value of the fund’s investments may decrease, sometimes rapidly or unexpectedly, due to factors
affecting an issuer held by the fund, particular industries, or the overall securities markets. A variety
of factors can increase the volatility of the fund’s holdings and markets generally, including economic,
political, or regulatory developments, recessions, inflation, rapid interest rate changes, war, military
conflict, acts of terrorism, natural disasters, and outbreaks of infectious illnesses or other widespread
public health issues (such as the coronavirus pandemic) and related governmental and public responses
(including sanctions). Certain events may cause instability across global markets, including reduced
liquidity and disruptions in trading markets, while some events may affect certain geographic regions,
countries, sectors, and industries more significantly than others. Government intervention in markets
may impact interest rates, market volatility, and security pricing. These adverse developments may cause
broad declines in market value due to short-term market movements or for significantly longer periods
during more prolonged market downturns.
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| Stock investing |
Stock investing: Stocks generally fluctuate in value more
than bonds and may decline significantly over short time periods. There is a chance that stock prices
overall will decline because stock markets tend to move in cycles, with periods of rising and falling
prices. The value of stocks held by the fund may decline due to general weakness or volatility in the
stock markets in which the fund invests or because of factors that affect a particular company or industry.
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| Sector exposure |
Sector
exposure: Issuers in the same economic sector may be similarly affected by economic or
market events, making the fund more vulnerable to unfavorable developments in that economic sector than
funds that invest more broadly.
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| Information technology sector |
Information technology sector: Information technology
companies face intense competition, both domestically and internationally, which may have an adverse
effect on their profit margins. Like other technology companies, information technology companies may
have limited product lines, markets, financial resources, or personnel.
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| Index correlation |
Index correlation: Because
the fund weights each sector and industry approximately the same as the Index, the fund’s ability to
broadly reallocate its portfolio due to changes in outlook for a particular
sector or industry is more limited than other actively managed funds with greater flexibility to overweight
or underweight certain industries due to changes in market conditions. As a result, the fund’s performance
may lag the performance of other actively managed funds with more flexible investment programs.
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| Large-cap stocks |
Large-cap
stocks: Securities issued by large-cap companies tend to be less volatile than securities
issued by small- and mid-cap companies. However, large-cap companies may not be able to attain the high
growth rates of successful small- and mid-cap companies, especially during strong economic periods, and
may be unable to respond as quickly to competitive challenges.
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| Active management |
Active management:
The fund’s overall investment program and holdings selected by the fund’s investment adviser may
underperform the broad markets, relevant indices, or other funds with similar objectives and investment
strategies.
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| Cybersecurity breaches |
Cybersecurity breaches: The fund could be harmed by intentional
cyberattacks and other cybersecurity breaches, including unauthorized access to the fund’s assets,
confidential information, or other proprietary information. In addition, a cybersecurity breach could
cause one of the fund’s service providers or financial intermediaries to suffer unauthorized data access,
data corruption, or loss of operational functionality.
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| Performance
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The following performance
information provides some indication of the risks of investing in the fund. The fund’s performance
information represents only past performance (before and after taxes) and is not necessarily an indication
of future results. The following bar chart illustrates how much returns can differ from year to year
by showing calendar year returns and the best and worst calendar quarter returns during those years
for the fund.
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| Calendar Year Returns
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| | | | | | | | | | | | | Quarter Ended | Total Return | | | Quarter Ended | Total Return | | | | Best
Quarter | 12/31/23 | 12.14% | | Worst Quarter | 6/30/22 | -16.38% | |
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| Average Annual Total Returns Periods
ended December 31, 2024
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The following table shows
the average annual total returns for the fund. The fund’s performance information included in the table
is compared with a regulatory required index that represents an overall securities market (Regulatory
Benchmark). In addition, the table may also include one or more indexes that more closely aligns to the
fund’s investment strategy (Strategy Benchmark(s)). In addition, the table shows hypothetical
after-tax returns to demonstrate how taxes paid by a shareholder may influence returns. After-tax returns
are calculated using the historical highest individual federal marginal income tax rates and do not reflect
the impact of state and local taxes. Actual after-tax returns depend on an investor’s tax situation
and may differ from those shown. After-tax returns shown are not relevant to investors who hold their
fund shares through tax-deferred arrangements, such as a 401(k) account or an IRA.
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| Updated performance information
is available through troweprice.com.
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