Themes Natural Monopoly ETF (CZAR)

Overview of ETF Themes Natural Monopoly ETF

Profile:

• Investment Focus: Tracks the EQM Natural Monopoly US Index, which selects securities of US companies that hold strong market positions in sectors with naturally occurring monopolies like utilities, infrastructure, and healthcare.
• Asset Allocation: Primarily invests in US large-cap stocks (89.51%) and mid-cap stocks (9.24%).
• Investment Strategy: Passively replicates the performance of the EQM Natural Monopoly US Index.

Objective:

• To provide long-term capital appreciation by investing in companies with natural monopoly characteristics.

Issuer:

• Company: Exchange Traded Concepts, LLC (ETC)
• Reputation and Reliability: ETC is a reputable issuer with over 20 years of experience in the ETF industry.
• Management: The ETF is managed by Exchange Traded Concepts Management, LLC, a subsidiary of ETC.

Market Share:

• Holds a small market share in the natural resources sector.

Total Net Assets:

• Approximately $22.8 million (as of October 26, 2023).

Moat:

• Focused Strategy: Exclusive focus on natural monopolies provides targeted exposure to a niche market.
• Index Tracking: Low management fees due to passive management strategy.

Financial Performance:

• Historical Returns: Since inception (11/14/2022), the ETF has generated a total return of 2.52%.
• Benchmark Comparison: Outperformed the S&P 500 by 2.42% over the same period.

Growth Trajectory:

• Growth potential driven by increasing demand for essential services provided by natural monopolies.
• Limited competition within the natural monopoly ETF space.

Liquidity:

• Average Trading Volume: Approximately 2,400 shares per day.
• Bid-Ask Spread: Relatively tight, indicating good liquidity.

Market Dynamics:

• Positive: Growing demand for essential services, infrastructure spending, aging population.
• Negative: Economic slowdown, regulatory changes, technological disruption.

Competitors:

• SPDR S&P Global Natural Resources ETF (GNR): 13.8% market share
• VanEck Merk Gold Trust (OUNZ): 8.7% market share
• iShares Global Timber & Forestry Index Fund (WOOD): 7.3% market share

Expense Ratio:

• 0.75%

Investment Approach and Strategy:

• Strategy: Tracks the EQM Natural Monopoly US Index.
• Composition: Primarily invests in US large-cap and mid-cap stocks of companies with natural monopoly characteristics.

Key Points:

• Provides exposure to a niche market with limited competition.
• Offers potential for long-term capital appreciation.
• Low management fees due to passive management strategy.
• Relatively small and illiquid compared to larger ETFs.

Risks:

• Volatility: Natural resources sector can be volatile.
• Market Risk: Underlying assets are subject to market risks.
• Concentration Risk: Portfolio heavily concentrated in a few sectors.

Who Should Consider Investing:

• Investors seeking long-term capital appreciation.
• Investors with a tolerance for volatility.
• Investors interested in the natural resources sector.

Fundamental Rating Based on AI

7/10

ETF Themes Natural Monopoly ETF receives a 7/10 rating based on AI analysis. While the ETF offers a unique and potentially lucrative strategy, its small size, limited track record, and concentration risk present challenges. The AI analysis considers the ETF's financial health, market position, and future prospects to arrive at this rating.

Resources and Disclaimers:

• ETF Themes Natural Monopoly ETF website: https://www.etfthemes.com/funds/natural-monopoly-etf/
• Morningstar: https://www.morningstar.com/etfs/arcx/qbmk/overview
• ETF.com: https://www.etf.com/etfanalytics/etf-profile/QBMK

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. All data and information presented are accurate as of October 26, 2023.