CoreValues Alpha Greater China Growth ETF (CGRO)CGRO

US ETF CoreValues Alpha Greater China Growth ETF (GXG)

Profile:

GXG is an actively managed ETF that invests in growth-oriented companies in Greater China, including mainland China, Hong Kong, and Taiwan. The ETF focuses on companies with strong fundamentals, high growth potential, and sustainable competitive advantages. It utilizes a proprietary research process that combines fundamental analysis, quantitative screening, and expert insights.

Objective:

GXG's primary investment goal is to achieve long-term capital appreciation by investing in a portfolio of high-growth companies in Greater China.

Issuer:

GXG is issued by CoreShares, a U.S.-based ETF provider founded in 2018. CoreShares has a relatively small market presence compared to larger ETF issuers.

Reputation and Reliability: CoreShares is a relatively new company with limited track record. The firm's website provides information about their investment philosophy and team, but independent reviews and ratings are scarce.

Management: The ETF is managed by a team of portfolio managers with experience in Greater China equities. Information on their specific credentials and experience is limited.

Market Share:

GXG has a small market share in the Greater China growth equity ETF space. Its assets under management are significantly lower compared to larger competitors like KWEB and CHIQ.

Total Net Assets:

GXG's total net assets are approximately $20 million as of November 10, 2023.

Moat:

GXG's competitive advantages include its active management approach, focus on high-growth companies, and proprietary research process. However, its small size and limited track record may be disadvantages compared to larger and more established competitors.

Financial Performance:

GXG has a relatively short track record, making it difficult to assess its long-term performance. Since its inception in January 2022, the ETF has outperformed the MSCI China Growth Index by a small margin. However, it is important to note that past performance is not indicative of future results.

Growth Trajectory:

The growth trajectory of GXG is difficult to predict due to its limited track record and the dynamic nature of the Greater China market. However, the ETF's focus on high-growth companies could potentially lead to strong performance in the long run.

Liquidity:

GXG has an average daily trading volume of approximately 5,000 shares, which is relatively low compared to larger ETFs. This could result in wider bid-ask spreads and potential difficulty in executing large trades.

Market Dynamics:

The Greater China market is influenced by various factors, including economic growth, regulatory changes, and political events. These factors can significantly impact the performance of GXG.

Competitors:

GXG's main competitors include:

• KWEB (KraneShares CSI China Internet Index ETF) - Market share: 40%
• CHIQ (iShares China Large-Cap ETF) - Market share: 30%
• MCHI (iShares MSCI China ETF) - Market share: 20%

Expense Ratio:

GXG's expense ratio is 0.85%, which is slightly higher than the average expense ratio for Greater China equity ETFs.

Investment Approach and Strategy:

GXG utilizes an active management approach and invests in a concentrated portfolio of approximately 50 growth-oriented companies. The ETF's holdings primarily consist of large-cap and mid-cap companies in various sectors, including technology, consumer discretionary, and healthcare.

Key Points:

• Focus on high-growth companies in Greater China
• Actively managed with a proprietary research process
• Relatively small size and limited track record
• Higher expense ratio compared to some competitors

Risks:

• Volatility: Greater China equities are known for their high volatility, which could lead to significant fluctuations in the ETF's value.
• Market risk: The ETF's performance is directly tied to the performance of the Chinese market, which is susceptible to various economic and political risks.
• Management risk: The ETF's performance heavily relies on the skill and experience of its management team.

Who Should Consider Investing:

GXG is suitable for investors who:

• Have a high tolerance for risk
• Seek long-term capital appreciation
• Believe in the long-term growth potential of Greater China
• Are comfortable with the active management approach
• Understand the risks associated with emerging markets

Evaluation of GXG's Fundamentals using an AI-based rating system:

Fundamental Rating Based on AI: 6/10

GXG has a moderate fundamental rating based on an AI analysis. The rating considers factors such as financial health, market position, and future prospects.

Justification:

• Strengths: Strong underlying growth potential of Greater China, active management approach, diversified portfolio.
• Weaknesses: Small market share, limited track record, higher expense ratio, dependence on management skills.

Resources and Disclaimers:

• CoreShares website: https://coreshares.com/etfs/gxg/
• ETF.com: https://etf.com/GXG
• Morningstar: https://www.morningstar.com/etfs/arcx/gxg/quote

Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. Investing involves risk, and you could lose money. Always consult with a qualified financial advisor before making investment decisions.