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

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

*Profile:

Target Sector: Large-cap U.S. equities with a focus on environmental, social, and governance (ESG) factors.

Investment Strategy: Replicates the Avantis Responsible US Equity Large Cap Index, utilizing a quantitative methodology to select stocks with favorable ESG profiles while seeking to match the overall sector and style characteristics of the Russell 1000 Index.

Objective: To provide long-term capital appreciation while aligning investments with ESG principles.

*Issuer:

American Century Investments:

• Reputation and Reliability: Founded in 1958, American Century is a respected asset manager with a long track record and $231 billion in assets under management (as of August 31, 2023).
• Management: Experienced team with expertise in ESG investing and quantitative index construction.

*Market Share:

AVSU is a relatively new ETF launched in November 2022, making it difficult to assess its market share accurately.

*Total Net Assets:

The total net assets of AVSU are currently around $262.32 million (as of November 14, 2023).

*Moat:

• ESG Focus: AVSU offers exposure to the growing demand for ESG-aligned investments.
• Quantitative Approach: The index selection methodology provides a systematic and transparent approach to ESG integration.
• Low-Cost: AVSU has an expense ratio of 0.25%, making it a cost-effective option for ESG investing.

*Financial Performance:

• Since Inception (11/14/2022): AVSU has a total return of 2.12% (as of November 14, 2023).
• Benchmark Comparison: AVSU has outperformed the Russell 1000 Index (1.71% return) since its inception.

*Growth Trajectory:

The demand for ESG investments is expected to continue growing, providing potential tailwinds for AVSU.

*Liquidity:

• Average Trading Volume: 16,324 shares (as of November 14, 2023).
• Bid-Ask Spread: 0.02% (as of November 14, 2023), indicating good liquidity.

*Market Dynamics:

• Economic Indicators: Rising interest rates and inflation could impact the overall stock market.
• Sector Growth Prospects: The U.S. large-cap sector is expected to continue experiencing moderate growth.
• Current Market Conditions: Market volatility and geopolitical uncertainties could create short-term challenges.

*Competitors:

• iShares ESG Aware S&P 500 ETF (ESGV) - 0.15% market share
• Vanguard ESG US Stock ETF (ESGV) - 0.13% market share
• SPDR S&P 500 ESG ETF (EFIV) - 0.09% market share

*Expense Ratio:

0.25% per year.

*Investment Approach and Strategy:

• Strategy: Tracks the Avantis Responsible US Equity Large Cap Index.
• Composition: Primarily holds large-cap U.S. stocks with high ESG ratings.

*Key Points:

• Offers ESG-focused exposure to U.S. large-cap equities.
• Low-cost compared to other ESG ETFs.
• Outperformed benchmark since inception.
• Actively managed and transparent index methodology.

*Risks:

• Market Risk: Subject to fluctuations in the U.S. stock market.
• ESG Integration Risk: The ESG screening process may exclude potentially high-performing stocks.
• Relatively New ETF: Limited track record compared to established competitors.

*Who Should Consider Investing:

• Investors seeking ESG-aligned exposure to the U.S. large-cap market.
• Investors looking for a low-cost and actively managed ESG ETF.
• Investors with a long-term investment horizon.

*Fundamental Rating Based on AI:

8.5 out of 10

AVSU scores well on its ESG focus, low expense ratio, and outperformance against its benchmark. However, its recent launch and relatively small asset base warrant some caution. Overall, it appears to be a solid option for ESG-conscious investors seeking exposure to large-cap U.S. equities.

*Resources and Disclaimers:

• Data sources: American Century Investments, ETF.com, Morningstar
• This information should not be considered financial advice. Please consult a financial professional before making investment decisions.