Baron Financials ETF

BCFN

Market cap $46M

A tidal wave of conversions has siphoned an unprecedented amount of capital out of mutual funds and into the ETF wrapper. Last year's record 60 mutual-fund-to-ETF conversions in 2025 across 31 firms pushed total converted assets past $260 billion, and the past five years have now seen a grand total of 203 conversions.

Baron Capital continues to grow its active ETF lineup with today's introduction of Baron Risk Optimized Large Cap ETF™ (BROL). The ETF builds upon the firm's commitment to long-term growth investing with a targeted focus on U.S. large-cap companies that exhibit durable competitive advantages, significant growth opportunities, exceptional management teams, and compelling valuations.

Sector-specific changes in global finance are leading to a new era of digital innovation that's replacing traditional banking. For investors looking to capitalize on this next wave of growth opportunities in financials, Baron Financials ETF (BCFN) — managed by portfolio manager Josh Saltman — offers a high-conviction, active approach to investing in the sector.

For investors seeking opportunities in the finance sector, an active approach can be beneficial. Today's financial landscape is undergoing structural, regulatory, and macroeconomic shifts.

Active exchange-traded funds (ETFs) came to the forefront in 2025 with the launch of a record number of funds catering to active strategies. 2026 could bring another year for heavy active ETF demand from investors.

During the quarter, the Fund invested in Morgan Stanley, a leading global investment bank and wealth management firm. The Fund also participated in the IPO of Neptune Insurance Holdings Inc., the leading underwriter of private flood insurance. We trimmed Guidewire Software, Inc. on strength to manage exposure to the volatile software sector.

Baron FinTech Fund declined during the fourth quarter, and underperformed its benchmark, the MSCI USA Financials Index. Top contributors were Fair Isaac Corporation, S&P Global Inc., and Jack Henry & Associates, Inc. Top detractors were Robinhood Markets Inc., MercadoLibre Inc., and Guidewire Software, Inc.