American Century ETF Trust - Avantis Responsible U.S. Equity ETF (AVSU)

ETF American Century ETF Trust - Avantis Responsible U.S. Equity ETF (AVUS)

Profile:

AVUS is an actively managed ETF that invests in U.S. large-cap stocks with a focus on environmental, social, and governance (ESG) factors. It seeks to outperform the Russell 1000 Index by investing in companies with strong ESG practices and potential for long-term growth.

Objective:

The primary objective of AVUS is to provide long-term capital appreciation and outperform the Russell 1000 Index by investing in a portfolio of U.S. large-cap stocks while also considering ESG factors.

Issuer:

American Century Investments

• Reputation and Reliability: American Century Investments is a reputable and reliable asset management firm with over 50 years of experience. They manage over $200 billion in assets across various investment products.
• Management: The ETF is managed by a team of experienced portfolio managers with expertise in ESG investing and U.S. equities.

Market Share:

AVUS has a relatively small market share within the ESG Large Cap Equity ETF category, accounting for approximately 0.25% of the total assets under management.

Total Net Assets:

As of November 2023, AVUS has approximately $350 million in total net assets.

Moat:

AVUS's competitive advantages include:

• Active Management: The ETF utilizes an active management approach, which allows the portfolio managers to select stocks with the potential for superior returns.
• ESG Focus: The focus on ESG factors differentiates AVUS from other large-cap ETFs and attracts investors who want to align their investments with social and environmental values.
• Experienced Management Team: The ETF is managed by a team of experienced professionals with a strong track record in ESG investing.

Financial Performance:

• Historical Performance: AVUS has delivered competitive returns since its inception in 2022. Over the past year, the ETF has generated a total return of approximately 10%, outperforming the Russell 1000 Index by 2%.
• Benchmark Comparison: AVUS has consistently outperformed the Russell 1000 Index since its launch, demonstrating its ability to generate alpha.

Growth Trajectory:

The ETF's growth trajectory is positive, considering the increasing demand for ESG investments and the strong performance of the underlying portfolio.

Liquidity:

• Average Trading Volume: The average daily trading volume for AVUS is approximately 50,000 shares, indicating decent liquidity.
• Bid-Ask Spread: The bid-ask spread for AVUS is typically between 0.05% and 0.10%, relatively tight for an actively managed ETF.

Market Dynamics:

Market dynamics positively influencing AVUS include:

• Growing Demand for ESG Investments: The demand for ESG investments is rapidly increasing, driving inflows into ESG-focused ETFs like AVUS.
• Strong U.S. Equity Market: The U.S. equity market has performed well in recent years, benefiting AVUS as it invests in large-cap U.S. stocks.

Competitors:

• iShares ESG Aware MSCI USA ETF (ESGU) - 35% market share
• Vanguard ESG U.S. Stock ETF (ESGV) - 25% market share
• Xtrackers MSCI USA ESG Leaders Equity ETF (USSG) - 15% market share

Expense Ratio:

The expense ratio for AVUS is 0.25%, which is slightly higher than the average for ESG Large Cap Equity ETFs.

Investment Approach and Strategy:

• Strategy: AVUS actively manages its portfolio to outperform the Russell 1000 Index. The portfolio managers select stocks based on a combination of financial metrics, ESG factors, and the potential for long-term growth.
• Composition: The ETF mainly invests in large-cap U.S. stocks across various sectors, with a focus on companies with strong ESG practices.

Key Points:

• Actively managed ESG-focused ETF seeking long-term capital appreciation.
• Outperformed the Russell 1000 Index since inception.
• Experienced management team with a strong track record.
• Growing demand for ESG investments and positive market dynamics support future growth.

Risks:

• Volatility: As an actively managed ETF, AVUS may experience higher volatility than passively managed index ETFs.
• Market Risk: The ETF's performance is tied to the overall performance of the U.S. equity market, which can be volatile.
• Concentration Risk: The ETF's focus on large-cap stocks could lead to higher concentration risk compared to more diversified ETFs.

Who Should Consider Investing:

AVUS is suitable for investors seeking:

• Long-term capital appreciation.
• Exposure to U.S. large-cap stocks.
• Investments aligned with ESG principles.
• Active management with the potential for outperformance.

Fundamental Rating Based on AI:

Based on an AI-based rating system, AVUS receives a rating of 7 out of 10. This rating considers the ETF's financial performance, market position, future prospects, and other factors mentioned above. The rating suggests that AVUS has strong fundamentals and deserves consideration for investors seeking a competitive ESG-focused large-cap equity ETF.

Resources and Disclaimers:

• American Century ETF Trust - Avantis Responsible U.S. Equity ETF
• Morningstar AVUS Profile
• Yahoo Finance AVUS Profile

Disclaimer: This information is for educational purposes only and should not be considered investment advice. Please consult with a financial professional before making any investment decisions.