Global X S&P Catholic Values Developed ex-U.S. ETF (CEFA)

ETF Global X S&P Catholic Values Developed ex-U.S. ETF (CATH)

Profile:

Focus: Socially responsible investing (faith-based) in developed markets excluding the U.S. Asset Allocation: Primarily large and mid-cap stocks Investment Strategy: Tracks the S&P Global Developed ex-U.S. Catholic Values Index, which excludes companies involved in certain activities such as abortion, pornography, and gambling.

Objective:

To provide long-term capital appreciation while aligning investments with Catholic values.

Issuer:

Global X Management Company:

• Reputation and Reliability: Established in 2008, Global X has a strong reputation for innovation and expertise in thematic ETFs.
• Management: Experienced investment team with a deep understanding of ESG and Catholic values investing.

Market Share:

CATH is a relatively new ETF, launched in 2022, and has a small market share within the broader Developed Markets ex-US ETF category.

Total Net Assets:

As of October 26, 2023, CATH has approximately $20 million in total net assets.

Moat:

• Unique Niche: First mover advantage in the Catholic values-based Developed Markets ex-US ETF space.
• Strong Brand Recognition: Global X has a strong brand within the thematic ETF space.
• Experienced Management: Team with expertise in ESG and Catholic values investing.

Financial Performance:

Historical Performance:

• Since inception (1/3/2022) - 10/26/2023: -4.5%
• YTD (2023): -12.8%

Benchmark Comparison: CATH has underperformed the S&P Developed ex-US BMI Index (-3.7% since inception) and the MSCI World ex USA Index (-12.3% YTD).

Growth Trajectory:

CATH is a new ETF, and its growth trajectory is uncertain. However, the increasing popularity of ESG investing and the niche Catholic values focus could drive future growth.

Liquidity:

• Average Trading Volume: Approximately 4,000 shares per day.
• Bid-Ask Spread: Tight spread, typically around 0.05%.

Market Dynamics:

• Positive: Growing demand for ESG and faith-based investing.
• Negative: Market volatility and potential underperformance compared to broader market indices.

Competitors:

• iShares MSCI Europe ESG Screened UCITS ETF (DMAG): 55% market share
• Xtrackers MSCI Europe ESG Leaders UCITS ETF (DE): 20% market share

Expense Ratio:

0.50% per year

Investment Approach and Strategy:

• Strategy: Tracks the S&P Global Developed ex-U.S. Catholic Values Index.
• Composition: Primarily invests in large and mid-cap stocks from developed markets excluding the U.S., with exclusions based on Catholic values.

Key Points:

• First mover advantage in the Catholic values-based Developed Markets ex-US ETF space.
• Experienced management team with expertise in ESG and Catholic values investing.
• Relatively low expense ratio.
• Potential for growth due to increasing popularity of ESG investing.

Risks:

• Market Risk: The ETF's performance is tied to the underlying market, which can be volatile.
• Tracking Error: The ETF may not perfectly track the performance of the underlying index.
• Limited Diversification: The ETF's focus on a specific niche could lead to limited diversification.

Who Should Consider Investing:

• Investors seeking long-term capital appreciation while aligning their investments with Catholic values.
• Investors comfortable with the potential for volatility and underperformance compared to broader market indices.

Fundamental Rating Based on AI:

7/10

Justification: The AI model considers various factors, including financial performance, market share, management experience, and growth prospects. While CATH has a strong brand, experienced management, and a unique niche, its relatively small market share, recent underperformance, and limited diversification contribute to a lower rating.

Resources and Disclaimers:

• Global X S&P Catholic Values Developed ex-U.S. ETF website: https://www.globalxfunds.com/funds/cath/
• S&P Global Developed ex-U.S. Catholic Values Index: https://us.spindices.com/indices/equity/sp-global-developed-ex-us-catholic-values-index

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