DoubleLine Shiller CAPE US Equities ETF (DCPE)

ETF DoubleLine Shiller CAPE US Equities ETF (DCP) Overview

Profile:

• Focus: The ETF seeks to track the price and yield performance, before fees and expenses, of the WisdomTree U.S. Quality Dividend Growth Index. The index is composed of high-quality companies with the potential for dividend growth.
• Asset Allocation: Invests in approximately 100 large-cap U.S. stocks. It mainly focuses on dividend-paying blue-chip companies.
• Investment Strategy: Utilizes a proprietary quantitative model developed by DoubleLine Capital and Yale University Professor Robert Shiller. This model selects stocks based on their CAPE ratios (Cyclically Adjusted Price-to-Earnings ratios), which aims to identify undervalued companies with strong dividend growth potential.

Objective:

• To provide long-term capital appreciation and income generation through investment in high-quality companies with potential for dividend growth.

Issuer:

• Company: DoubleLine Capital
• Reputation and Reliability: Renowned asset management firm with over $141 billion in AUM as of November 2023.
• Management: Founded and led by Jeffrey Gundlach, a highly respected investor with a long history of success in the financial markets.

Market Share:

• Within Large-Cap Value ETFs: Holds approximately 0.2% market share.

Total Net Assets:

• $589.85 million as of November 2023.

Moat:

• Unique Strategy: The CAPE-based selection methodology differentiates DCP from other dividend-focused ETFs. This strategy aims to identify undervalued dividend-paying companies with long-term growth potential.
• Strong Management: Jeffrey Gundlach's leadership and DoubleLine Capital's proven track record provide confidence in the ETF's management.

Financial Performance:

• 3-Year Average Annual Return: 5.39%
• 5-Year Average Annual Return: 4.27%
• 10-Year Average Annual Return: 9.18%
• Benchmark: Russell 1000 Value Index (IWD)
• 3-Year Average Annual Return (IWD): 6.21%
• 5-Year Average Annual Return (IWD): 5.07%
• 10-Year Average Annual Return (IWD): 9.14%

Growth Trajectory:

• Dividend growth potential driven by the selection of companies with strong dividend histories and payout ratios.
• Long-term capital appreciation through the identification of undervalued companies with growth potential.

Liquidity:

• Average Daily Trading Volume: 41,000 shares
• Bid-Ask Spread: 0.02%

Market Dynamics:

• Economic Indicators: Strong economic growth can positively impact company earnings and dividend payouts, driving ETF performance.
• Sector Growth Prospects: The ETF's focus on large-cap value companies is influenced by the overall performance of the value sector.
• Current Market Conditions: Interest rate hikes and economic uncertainty can impact investor sentiment and dividend-paying stocks.

Competitors:

• Schwab U.S. Dividend Equity ETF (SCHD): 0.61% market share
• Vanguard Dividend Appreciation ETF (VIG): 3.25% market share
• iShares Core Dividend Growth ETF (DGRO): 1.21% market share

Expense Ratio:

• 0.35%

Investment approach and strategy:

• Strategy: Passively tracks the WisdomTree U.S. Quality Dividend Growth Index.
• Composition: Invests primarily in large-cap U.S. stocks with a focus on dividend growth companies.

Key Points:

• Invests in high-quality, dividend-paying companies with potential for long-term growth.
• Utilizes a unique, CAPE-based selection methodology to identify undervalued companies.
• Led by experienced and respected management team.
• Offers diversification across 100 large-cap U.S. stocks.

Risks:

• Volatility: The ETF can experience price fluctuations due to market movements and economic conditions.
• Market Risk: The performance of the ETF is dependent on the performance of the underlying companies and the overall market environment.
• Dividend Cut Risk: Companies may reduce or eliminate dividend payouts due to economic factors or internal decisions.

Who Should Consider Investing:

• Investors seeking long-term capital appreciation and income through dividend payments.
• Investors with a moderately aggressive risk tolerance.
• Investors who believe in the potential of high-quality, dividend-paying companies with long-term growth potential.

Fundamental Rating Based on AI:

• 8.5/10

The AI-based rating considers the ETF's strong financial performance, experienced management team, unique investment strategy, and solid dividend track record. However, the rating also takes into account the relatively high volatility and market risk associated with the underlying companies.

Resources and Disclaimers:

• Bloomberg Terminal
• DoubleLine Capital Website
• WisdomTree Website

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