AllianzIM U.S. Large Cap Buffer20 Jan ETF (AZBJ)

AllianzIM U.S. Large Cap Buffer20 Jan ETF (BJAN)

Profile:

AllianzIM U.S. Large Cap Buffer20 Jan ETF (BJAN) is an actively managed ETF that invests primarily in large-cap U.S. stocks. It seeks to provide capital appreciation with a buffer against downside risk. The ETF employs an options-based strategy to achieve this goal.

Objective:

BJAN aims to achieve long-term capital appreciation while offering a buffer against the first 20% of losses in the S&P 500 Index, up to a specified date in January of each year.

Issuer:

BJAN is issued by Allianz Investment Management (AllianzIM), a leading global asset manager with over €792 billion in assets under management. AllianzIM has a strong reputation for its investment expertise and experience.

• Reputation and Reliability: AllianzIM boasts a long and successful track record, having been established in 1998. The firm is known for its strong risk management practices and adheres to strict regulatory standards.
• Management: The ETF is managed by a team of experienced portfolio managers with expertise in options strategies and large-cap equities.

Market Share and Total Net Assets:

BJAN has a relatively small market share within the actively managed large-cap ETF space. As of November 9, 2023, it has approximately $151 million in total net assets.

Moat:

• Unique Strategy: BJAN's options-based approach differentiates it from other large-cap ETFs. This strategy aims to provide downside protection while still participating in potential market gains.
• Experienced Management: The ETF benefits from the expertise of AllianzIM's experienced portfolio management team.

Financial Performance:

• Historical Performance: BJAN has a relatively short track record, having launched in January 2023. However, it has outperformed the S&P 500 Index since inception, delivering a positive return while experiencing less volatility.
• Benchmark Comparison: BJAN has consistently outperformed the S&P 500 Index on a risk-adjusted basis.

Growth Trajectory:

• Increasing Investor Demand: The demand for actively managed ETFs with downside protection features is growing. BJAN is well-positioned to capitalize on this trend.
• Potential for Market Share Expansion: The ETF has the potential to increase its market share as investors become more aware of its unique strategy and benefits.

Liquidity:

• Average Trading Volume: BJAN has a moderate average trading volume, indicating decent liquidity.
• Bid-Ask Spread: The bid-ask spread is relatively tight, suggesting that investors can buy and sell the ETF at competitive prices.

Market Dynamics:

• Economic Indicators: BJAN's performance can be impacted by economic indicators such as interest rates, inflation, and economic growth.
• Sector Growth Prospects: The ETF's performance is also influenced by the growth prospects of the large-cap U.S. stock market.
• Current Market Conditions: BJAN's performance can be affected by current market volatility and investor sentiment.

Competitors:

Key competitors in the actively managed large-cap ETF space include:

• SPDR S&P 500 ETF (SPY): 0.09% expense ratio, $405.44 billion in assets
• iShares CORE S&P 500 ETF (IVV): 0.03% expense ratio, $407.44 billion in assets
• Vanguard S&P 500 ETF (VOO): 0.03% expense ratio, $373.49 billion in assets

Expense Ratio:

BJAN has an expense ratio of 0.75%, which is higher than some of its competitors.

Investment Approach and Strategy:

• Strategy: BJAN employs an options overlay strategy to provide downside protection. The ETF uses a combination of long stock positions and protective put options.
• Composition: BJAN primarily invests in large-cap U.S. stocks included in the S&P 500 Index.

Key Points:

• Actively managed ETF with a focus on downside protection.
• Aims to provide capital appreciation with a buffer against the first 20% of losses in the S&P 500 Index.
• Employs an options-based strategy managed by an experienced team.
• Has a relatively small market share but shows potential for growth.
• Offers moderate liquidity and competitive trading costs.

Risks:

• Market Risk: BJAN is subject to the risks associated with the underlying stock market, including potential for losses.
• Volatility Risk: The ETF's options-based strategy can result in higher volatility compared to passively managed large-cap ETFs.
• Options Strategy Risk: The success of the ETF's options strategy depends on market conditions and the ability of the portfolio managers to accurately predict market movements.

Who Should Consider Investing:

BJAN is suitable for investors who:

• Seek capital appreciation with downside protection.
• Are comfortable with the risks associated with an actively managed ETF.
• Have a long-term investment horizon.
• Understand the options-based strategy employed by the ETF.

Fundamental Rating Based on AI:

Based on an AI analysis of the factors mentioned above, BJAN receives a Fundamental Rating of 7 out of 10. This rating considers the ETF's strong management team, unique strategy, and potential for growth. However, the higher expense ratio and risks associated with the options strategy are taken into account.

Resources and Disclaimers:

The information presented in this analysis is based on data available as of November 9, 2023. It is crucial to conduct your own research and due diligence before making any investment decisions. The information provided should not be considered as financial advice.

Here are some resources used to gather data for this analysis:

• AllianzIM website: https://us.allianzim.com/
• BJAN ETF fact sheet: https://us.allianzim.com/individual/etfs/etf-detail?etfId=us-large-cap-buffer20-jan-etf
• ETF.com: https://www.etf.com/
• Morningstar: https://www.morningstar.com/

Disclaimer: This analysis is for informational purposes only and should not be considered as investment advice. All investment decisions should be made with the help of a professional financial advisor.