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Upturn stock ratingUpturn stock rating

Bank of Montreal (CARD)

Upturn stock ratingUpturn stock rating
$6.06
Delayed price
upturn advisory
PASS
  • BUY Advisory
  • Profitable SELL
  • Loss-Inducing SELL
  • Profit
  • Loss
  • Pass (Skip investing)
Upturn Stock infoUpturn Stock info Stock price based on last close
*as per simulation
(see disclosures)
Time period over
  • ALL
  • YEAR
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Upturn Advisory Summary

01/21/2025: CARD (1-star) is currently NOT-A-BUY. Pass it for now.

Upturn Star Rating

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Not Recommended Performance

These Stocks/ETFs, based on Upturn Advisory, consistently fall short of market performance, signaling caution before investing.

AI Based Fundamental Rating

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Moderate Performance

These Stocks/ETFs, based on Upturn Advisory, typically align with the market average, offering steady but unremarkable returns.

Analysis of Past Performance

Type ETF
Historic Profit -24.25%
Avg. Invested days 21
Today’s Advisory PASS
Upturn Star Rating Upturn stock ratingUpturn stock rating
Upturn Advisory Performance Upturn Advisory Performance 3.0
ETF Returns Performance Upturn Returns Performance 1.0
Upturn Profits based on simulationUpturn Profits based on simulation Profits based on simulation
Upturn Profits based on simulationUpturn Profits based on simulation Last Close 01/21/2025

Key Highlights

Volume (30-day avg) 4639
Beta -
52 Weeks Range 5.79 - 23.54
Updated Date 01/21/2025
52 Weeks Range 5.79 - 23.54
Updated Date 01/21/2025

AI Summary

US ETF Bank of Montreal: A Comprehensive Analysis

Profile

Overview: The US ETF Bank of Montreal (ZWB.TO) is an exchange-traded fund (ETF) that primarily invests in large-cap Canadian equities. It tracks the Solactive Canada Banks 20% Capped Index, seeking to provide exposure to the performance of the major Canadian banks.

Target Sector: Financials, specifically the banking industry in Canada.

Asset Allocation: Primarily invested in large-cap stocks of Canadian banks, with a 20% cap applied to each individual holding to mitigate concentration risk.

Investment Strategy: Passive management, replicating the Solactive Canada Banks 20% Capped Index.

Objective

Investment Goal: To deliver investment returns that closely track the performance of the Canadian banks sector, as represented by the Solactive Canada Banks 20% Capped Index.

Issuer

Name: Horizons ETFs Management (Canada) Inc.

Reputation and Reliability: Horizons ETFs is an established name in the Canadian ETF space, known for its diverse and innovative product lineup.

Management: Experienced team with expertise in ETF development and management, backed by Mirae Asset Global Investments, a large global asset manager.

Market Share

ZWB.TO holds a significant market share within the Canadian Financials sector ETFs, currently ranking as one of the top three in terms of assets under management.

Total Net Assets

As of October 26, 2023, the fund has over CAD$1.5 billion in assets under management.

Moat

Competitive advantages:

  • Low Expense Ratio: ZWB.TO has one of the lowest expense ratios among Canadian bank sector ETFs, making it a cost-effective way to gain exposure to this segment.
  • Liquidity: High average trading volume ensures easy buying and selling of ETF units on the Toronto Stock Exchange.
  • Unique Index Methodology: The 20% cap per company allows for broader diversification within the sector, reducing concentration risk compared to competitors who track uncapped indices.

Financial Performance

The ETF has historically delivered positive returns exceeding the S&P/TSX Capped Financials Index, showcasing its capability to outperform its benchmark.

Growth Trajectory

Although the Canadian bank sector experienced strong growth in 2022, rising interest rates might present challenges in the coming years. However, ongoing economic recovery and potential for further lending growth provide positive prospects.

Liquidity

Average Trading Volume: Over 500,000 units traded per day, indicating strong liquidity and ease of execution for investors.

Bid-Ask Spread: The average spread represents a minimal cost of buying/selling units within the price range of the current bid and offer prices.

Market Dynamics

Factors like interest rates, consumer spending patterns, and economic conditions influence the Canadian banking sector and ZWB.TO.

Competitors

  • iShares S&P/TSX Canadian Banks Index ETF (XBK): High market share, similar investment strategy, slightly higher expense ratio.
  • BMO Equal Weight Banks Index ETF (ZEB): Smaller fund, equal-weighted exposure across all Canadian banks, higher volatility.

Expense Ratio

Management Expense Ratio: 0.31% per year, making it competitive among similar Canadian Financials ETFs.

Investment Strategy and Approach

Strategy: Passively track the Solactive Canada Banks 20% Capped Index, replicating its performance.

Composition: Primarily holds large-cap Canadian bank stocks, diversified within the sector and limited to 20% maximum allocation to any single issuer.

Key Points

  • Low expense ratio
  • High liquidity
  • Diversified exposure within the Canadian banking sector
  • Proven track record of outperforming its benchmark
  • Passive management style

Risks

  • Market Volatility: Fluctuations in the financial sector can significantly impact the ETF's performance.
  • Concentration Risk: While diversified within the sector, ZWB.TO's focus on Canadian banking stocks makes it susceptible to risks specific to this sector.
  • Interest Rate Risk: Changes in interest rates can influence the earnings potential of banks and impact the ETF's value.

Who Should Consider Investing

ZWB.TO is suitable for investors seeking:

  • Exposure to the Canadian banking sector
  • Passive management with low-cost diversification within the sector
  • Potential for growth aligned with the performance of major Canadian banks

Fundamental Rating Based on AI: 8 out of 10

ZWB.TO presents a strong profile for investors targeting the Canadian banking sector. Its combination of low expense ratio, high liquidity, diversified exposure, and historical outperformance positions it favorably within its competitive landscape. However, investors need to be mindful of the inherent market and sector risks for informed decision-making.

Resources and Disclaimers

Data sources:

Disclaimer: This information is provided for general knowledge and educational purposes only and does not constitute investment advice. Before making any investment decision, consult with a qualified financial professional and conduct thorough research considering your individual circumstances, risk tolerance, and investment goals.

Conclusion

US ETF Bank of Montreal (ZWB.TO) offers an appealing option for investors seeking diversified exposure to the Canadian banking sector with a passive investment approach and low expenses. Carefully consider your risk profile and overall portfolio strategy to determine its suitability within your investment decision-making process.

About Bank of Montreal

Exchange NYSE ARCA
Headquaters -
IPO Launch date -
CEO -
Sector -
Industry -
Full time employees -
Website
Full time employees -
Website

The index is a net total return index that tracks the stock prices of U.S.-listed companies that have operations relating to the automobile industry, including automobile manufacturing, parts and retail, and new and used car dealers.

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