ETFs were originally designed as alternatives to index funds, but ones that could be actively traded like stocks -- meaning continuous trading and the ability to short and margin. As ETFs have developed, however, they are now moving into active (as opposed) to passive management. This may increase costs, but it provides another avenue for potential investors. See the article here, Index Universe.
Dolvin, Steven D., "Actively Managed ETFs" (2012). All Chapters. 19.