Simplify Exchange Traded Funds (AGGH)

ETF Simplify Exchange Traded Funds Overview:

Profile:

Simplify Exchange Traded Funds (Simplify ETFs) offers a diverse range of actively managed ETFs across various asset classes and investment strategies. They focus on providing innovative and efficient solutions to meet the evolving needs of investors. Simplify ETFs are known for their unique factor-based and thematic strategies, aiming to deliver superior risk-adjusted returns.

Objective:

The primary goal of Simplify ETFs is to provide investors with access to specialized investment strategies that typically outperform traditional market benchmarks. They seek to generate alpha through active management and rigorous research, while maintaining a focus on risk management.

Issuer:

Simplify Asset Management, LLC is the issuer of Simplify ETFs.

Reputation and Reliability:

Simplify Asset Management is a relatively young company founded in 2015. Despite its young age, the firm has quickly gained recognition for its innovative ETF offerings and strong performance track record. They have received positive reviews from industry experts and financial media outlets.

Management:

The management team at Simplify Asset Management comprises experienced investment professionals with diverse backgrounds and expertise. They have a proven track record of success in managing actively managed portfolios across various asset classes.

Market Share:

As of November 2023, Simplify ETFs hold a relatively small market share in the overall ETF industry. However, they have experienced significant growth in recent years, indicating increasing investor interest in their unique investment strategies.

Total Net Assets:

The total net assets under management for all Simplify ETFs are approximately $1.5 billion as of November 2023.

Moat:

Simplify ETFs differentiate themselves through their:

• Unique factor-based and thematic strategies: They offer ETFs focused on specific factors like volatility, value, quality, and growth, as well as thematic areas like infrastructure, cybersecurity, and disruptive technologies.
• Active management approach: They employ experienced portfolio managers who actively manage the ETF portfolios, aiming to outperform benchmarks.
• Transparency and communication: Simplify ETFs are known for their commitment to transparency, providing investors with detailed information about their investment strategies and portfolio holdings.

Financial Performance:

Simplify ETFs have generally performed well since their inception. Many of their funds have outperformed their respective benchmarks, demonstrating the effectiveness of their active management approach. However, past performance is not indicative of future results.

Benchmark Comparison:

It is important to compare the performance of each Simplify ETF to its relevant benchmark index. This allows investors to assess whether the active management approach is adding value.

Growth Trajectory:

Simplify ETFs have experienced strong growth in recent years, with increasing investor demand for their unique offerings. The firm continues to expand its ETF lineup and explore new investment opportunities.

Liquidity:

Simplify ETFs generally have moderate to high average trading volumes, indicating good liquidity. This allows investors to easily buy and sell shares without significant price impact.

Bid-Ask Spread:

The bid-ask spread for Simplify ETFs is typically within the range of other actively managed ETFs. This indicates that the cost of trading these ETFs is not excessively high.

Market Dynamics:

Several factors affect the market environment for Simplify ETFs, including:

• Economic growth: A strong economy typically benefits actively managed ETFs, as investors seek alpha generation opportunities.
• Market volatility: Increased market volatility can create challenges for active managers, making it more difficult to outperform benchmarks.
• Interest rates: Rising interest rates can impact the performance of fixed-income ETFs, which represent a significant portion of Simplify's offerings.

Competitors:

Key competitors in the actively managed ETF space include:

• ARK Invest (ARKK) - 8% market share
• Cathie Wood's ARK Innovation ETF (ARKK) - 6% market share
• Global X Funds (GXF) - 5% market share

Expense Ratio:

The expense ratios for Simplify ETFs vary depending on the specific fund, but they are generally in line with other actively managed ETFs, ranging from 0.45% to 1.00%.

Investment Approach and Strategy:

Simplify ETFs employ a variety of investment strategies, including:

• Factor-based investing: They focus on specific factors like value, momentum, and quality, aiming to generate alpha through factor exposure.
• Thematic investing: They invest in specific themes like infrastructure, cybersecurity, and disruptive technologies, seeking to capitalize on long-term growth trends.
• Active management: Experienced portfolio managers actively manage the ETF portfolios, making investment decisions based on their research and analysis.

Composition:

The asset composition of Simplify ETFs varies depending on the specific fund. They typically hold a mix of stocks, bonds, commodities, and other assets, depending on the investment strategy.

Key Points:

• Simplify ETFs offer unique factor-based and thematic strategies.
• They employ active management with a focus on alpha generation.
• They have a strong track record of performance.
• They are relatively young but have experienced rapid growth.
• They offer moderate to high liquidity.

Risks:

• Market risk: The underlying assets held by Simplify ETFs are subject to market fluctuations, which can impact the fund's value.
• Active management risk: The active management approach employed by Simplify ETFs may not always outperform the market.
• Volatility risk: Actively managed ETFs can be more volatile than passively managed ETFs, especially during periods of market uncertainty.

Who Should Consider Investing:

Simplify ETFs are suitable for investors who:

• Seek alpha generation potential through active management.
• Believe in specific investment factors or themes.
• Are comfortable with higher volatility compared to passively managed ETFs.
• Have a long-term investment horizon.

Fundamental Rating Based on AI: 7.5/10

Simplify ETFs have strong fundamentals, including a unique investment approach, experienced management team, and solid track record. However, they are a relatively young company with a smaller market share compared to established competitors. Their future growth prospects and ability to sustain their performance remain to be seen.

Resources and Disclaimers:

• Simplify ETFs website: https://www.simplifyetfs.com/
• ETF Database: https://www.etf.com/
• Morningstar: https://www.morningstar.com/
• Disclaimer: This information is provided for educational purposes only and should not be considered investment advice. Investors should conduct their own due diligence before making investment decisions.