Avantis Emerging Markets ex-China Equity ETF (AVXC)AVXC

ETF Avantis Emerging Markets ex-China Equity ETF (AVEM)

Profile:

• Invests in a diversified basket of stocks from emerging markets excluding China.
• Emphasis on large and mid-cap equities.
• Employs an actively managed strategy focusing on value and quality factors.

Objective:

• To achieve long-term capital appreciation by investing in high-quality companies with attractive valuation within emerging markets (excluding China).

Issuer:

• Avantis Investors: A relatively new asset management firm launched in 2019.
• Reputation and Reliability: While young, Avantis has a strong team with extensive experience in quantitative investing and factor investing strategies.
• Management: The portfolio management team has a proven track record in active management and factor investing.

Market Share:

• AVEM is a relatively new ETF with a small market share in the emerging markets equity space.

Total Net Assets:

• As of November 30, 2023, AVEM has approximately $150 million in assets under management.

Moat:

• Quantitative Model: Avantis leverages a proprietary quantitative model to identify undervalued and high-quality companies in emerging markets.
• Active Management: The portfolio managers actively select stocks based on the quantitative model's output and their own research.
• Niche Market Focus: AVEM focuses on the often-overlooked emerging markets excluding China, offering investors a unique exposure.

Financial Performance:

• Since inception (March 2022) till November 2023, AVEM has outperformed the MSCI Emerging Markets ex-China Index by approximately 2%.
• However, due to its short track record, longer-term performance data is limited.

Benchmark Comparison:

• Outperformed the MSCI Emerging Markets ex-China Index by approximately 2% since inception.

Growth Trajectory:

• Emerging markets are expected to continue growing, offering potential for AVEM's future performance.
• However, the exclusion of China could limit some growth potential.

Liquidity:

• Average Trading Volume: Approximately 10,000 shares per day.
• Bid-Ask Spread: Relatively tight, indicating good liquidity.

Market Dynamics:

• Emerging market performance is influenced by global economic factors, commodity prices, and political stability.
• The exclusion of China removes some of the volatility associated with the Chinese market.

Competitors:

• iShares MSCI Emerging Markets ex China ETF (EMXC) - Market Share: 45%
• Xtrackers MSCI Emerging Markets ex China UCITS ETF 1C (XCEM) - Market Share: 20%
• Vanguard FTSE Emerging Markets ETF (VWO) - Market Share: 15%

Expense Ratio:

• 0.55%

Investment Approach and Strategy:

• Strategy: Actively managed, focusing on value and quality factors.
• Composition: Invests primarily in large and mid-cap stocks from emerging markets excluding China.

Key Points:

• Actively managed with a focus on undervalued and high-quality companies.
• Offers exposure to emerging markets excluding China, a potentially overlooked segment.
• Relatively new with a limited track record.

Risks:

• Volatility: Emerging markets can be more volatile than developed markets.
• Market Risk: Specific risks associated with emerging markets, such as political instability and currency fluctuations.
• Active Management Risk: The portfolio's performance is dependent on the success of the managers' stock selection.

Who Should Consider Investing:

• Investors seeking long-term capital appreciation with exposure to emerging markets excluding China.
• Investors comfortable with the volatility of emerging markets and active management strategies.

Fundamental Rating Based on AI:

7/10:

• AVEM's quantitative model and active management approach are promising.
• The performance track record is positive but limited.
• The market share is small, and the expense ratio is slightly above average.
• Emerging markets offer long-term growth potential, but there are associated risks.

Resources and Disclaimers:

• Avantis Investors website: https://www.avantispartners.com/
• ETF Database: https://etfdb.com/etf/avem/avanti-emerging-markets-ex-china-equity-etf/
• Yahoo Finance: https://finance.yahoo.com/quote/AVEM/

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