Pictet Asset Management has expanded its exchange-traded fund offering with the launch of its first AI-driven active equity ETFs for the European market. The Geneva-based asset manager said the four funds are designed to deliver incremental outperformance over their respective benchmark indices while maintaining a risk profile close to passive investments.
The new range includes ETFs covering global equities, global equities excluding the U.S., U.S. equities and European equities. The products build on the firm’s Pictet – Quest AI-Driven Global Equities strategy, which has attracted more than $3 billion in assets since its launch in March 2024. Through the end of May 2026, the strategy returned 50.0 percent, outperforming the MSCI World Index, which gained 45.9 percent over the same period.
AI at the core
The ETFs follow an enhanced-index approach, targeting annual outperformance of around 1 percent net of fees while closely tracking their benchmark indices. The funds aim for a tracking error of up to 2 percent and a beta of 1.0, meaning returns are designed to move broadly in line with the market.
At the center of the strategy is Pictet’s proprietary AI model, which drives stock selection and automated portfolio optimization. The model is monitored by the firm’s quantitative investment team and retrained every quarter, with the aim of maintaining a factor-neutral strategy that is less dependent on market and economic cycles.
«Investors often believe improving returns means seeking new or exotic sources of outperformance,» said David Wright, Head of Quantitative Investments at Pictet Asset Management. «In reality, it’s often about navigating the same investment universe and data more intelligently. This is where AI excels – it can spot complex patterns that humans cannot see.»
Core portfolio building blocks
According to Pictet, the ETFs are designed as core portfolio holdings for investors seeking low-risk, lower-cost compounding outperformance. The firm said the AI model offers a different source of alpha from traditional factor-based enhanced-index approaches.
Some Pictet Asset Management clients are already using the model to offset the costs of passive holdings. According to the firm, reallocating around 20 percent of a passive equity allocation into an enhanced-index strategy can bring the cost of the index portion of a portfolio close to zero.
The new ETFs are initially listed on Xetra in Germany and Euronext in Italy. Additional listings on the London Stock Exchange and SIX Swiss Exchange are expected to follow.
