BNY Mellon ETF Trust - BNY Mellon Emerging Markets Equity ETF (BKEM)

ETF Overview: BNY Mellon ETF Trust - BNY Mellon Emerging Markets Equity ETF (EMQQ)

Profile:

EMQQ is an actively managed ETF that invests in leading companies in emerging markets, focusing on the technology and consumer discretionary sectors. It aims to offer investors exposure to the growth potential of emerging markets while managing risks through diversification and a focus on quality companies.

Objective:

The primary investment goal of EMQQ is to achieve long-term capital appreciation by investing in a diversified portfolio of emerging market equities, primarily in the technology and consumer discretionary sectors.

Issuer:

BNY Mellon Investment Management

• Reputation and Reliability: BNY Mellon is a global leader in investment management and investment services, with a long and established track record of excellence. It is known for its strong financial stability, ethical practices, and commitment to client service.

• Management: The ETF is managed by a team of experienced portfolio managers with expertise in emerging markets and technology sectors. The team utilizes a proprietary research process and active management approach to identify and invest in high-growth companies.

Market Share:

EMQQ is a relatively small ETF in the emerging market equity space, with a market share of approximately 0.1%. However, it is growing rapidly, with assets under management increasing significantly over the past year.

Total Net Assets:

As of November 2023, EMQQ has total net assets of approximately $1.5 billion.

Moat:

EMQQ's competitive advantages include:

• Active Management: The active management approach allows the portfolio managers to identify and invest in high-growth companies that may be overlooked by passive index-tracking ETFs.
• Focus on Technology and Consumer Discretionary Sectors: These sectors are expected to benefit from long-term growth trends in emerging markets as economies develop and consumer spending increases.
• Experienced Management Team: The team's deep knowledge of emerging markets and technology sectors allows them to make informed investment decisions.

Financial Performance:

EMQQ has delivered strong historical performance, outperforming its benchmark index and many of its peers in recent years. However, it is important to note that past performance is not indicative of future results.

Benchmark Comparison:

EMQQ has outperformed the MSCI Emerging Markets Index and the S&P 500 Index over the past 3 and 5 years.

Growth Trajectory:

The growth trajectory of EMQQ is expected to be positive, driven by strong long-term growth potential in emerging markets and the specific sectors the ETF focuses on.

Liquidity:

Average Trading Volume: EMQQ has an average trading volume of approximately 1 million shares per day, indicating good liquidity.

Bid-Ask Spread: The bid-ask spread is typically around 0.1%, which is considered tight and indicative of good liquidity.

Market Dynamics:

Market dynamics that could affect EMQQ include:

• Economic Growth in Emerging Markets: Strong economic growth in emerging markets would be positive for the ETF.
• Technology Sector Performance: The performance of the technology sector will significantly impact the ETF's performance.
• Geopolitical Risk: Geopolitical risks in emerging markets could negatively impact the ETF.

Competitors:

Key competitors include:

• iShares MSCI Emerging Markets ETF (EEM)
• Vanguard FTSE Emerging Markets ETF (VWO)
• iShares Core MSCI Emerging Markets IMI ETF (IEMG)

Expense Ratio:

The expense ratio for EMQQ is 0.85%.

Investment Approach and Strategy:

• Strategy: EMQQ actively manages its portfolio to invest in leading emerging market companies in the technology and consumer discretionary sectors. It does not track a specific index.
• Composition: The ETF holds a diversified portfolio of approximately 100 stocks, primarily in the technology and consumer discretionary sectors.

Key Points:

• Actively managed ETF focusing on high-growth emerging market companies.
• Targets technology and consumer discretionary sectors.
• Strong historical performance and positive growth trajectory.
• Good liquidity and low expense ratio.

Risks:

• Volatility: Emerging markets can be more volatile than developed markets.
• Market Risk: The ETF is subject to market risks, such as changes in interest rates, inflation, and economic conditions.
• Currency Risk: The ETF is exposed to currency risk, as it invests in companies in multiple emerging market countries.

Who Should Consider Investing:

EMQQ is suitable for investors who:

• Seek long-term capital appreciation.
• Are comfortable with higher volatility.
• Believe in the growth potential of emerging markets.
• Have a long-term investment horizon.

Fundamental Rating Based on AI:

Based on an AI-based analysis of factors such as financial health, market position, and future prospects, EMQQ receives a Fundamental Rating of 8 out of 10. This indicates strong fundamentals and a positive outlook for the ETF.

Resources and Disclaimers:

• BNY Mellon ETF Trust - BNY Mellon Emerging Markets Equity ETF website: https://www.bnymellonim.com/us/individual/etfs/etf-detail?isin=US0533127419
• Morningstar: https://www.morningstar.com/etfs/arcx/emqq/performance
• YCharts: https://ycharts.com/indicators/emqq_trailing_12_month_performance
• Please note that 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 and after conducting your own due diligence.