DoubleLine Shiller CAPE US Equities ETF (DCPE)

ETF DoubleLine Shiller CAPE US Equities ETF (CAPE)

Profile:

The ETF DoubleLine Shiller CAPE US Equities ETF (CAPE) is a passively managed exchange-traded fund that seeks to track the performance of the S&P 500 CAPE Index. This index utilizes the cyclically adjusted price-to-earnings ratio (CAPE) as a measure of market valuation. The CAPE is calculated by dividing the S&P 500 index by the average inflation-adjusted earnings of the past 10 years. The fund invests primarily in large-cap U.S. equities, aiming to achieve long-term capital appreciation.

Objective:

The primary investment goal of CAPE is to track the S&P 500 CAPE Index, providing investors with a cost-effective way to access the broad U.S. equities market while considering market valuation through the CAPE metric.

Issuer:

The ETF DoubleLine Shiller CAPE US Equities ETF is issued by DoubleLine Capital LP.

Reputation and Reliability:

DoubleLine Capital LP is a reputable asset management firm founded in 2009 by Jeffrey Gundlach, a well-respected figure in the financial industry. The firm manages over $150 billion in assets across various fixed income, equity, and alternative investment strategies.

Management:

The ETF's portfolio management is overseen by Jeffrey Gundlach and Philip Barach. Gundlach has extensive experience in portfolio management, with a strong track record in fixed income and alternative investments. Barach has over 20 years of experience in quantitative analysis and portfolio construction.

Market Share:

As of October 26, 2023, CAPE holds a market share of approximately 0.4% within the U.S. equities ETF space.

Total Net Assets:

As of October 26, 2023, CAPE's total net assets under management are approximately $2 billion.

Moat:

The ETF's competitive advantages include:

• Unique Investment Strategy: CAPE offers exposure to a valuation-conscious investment approach through its focus on the S&P 500 CAPE Index.
• Experienced Management: The ETF benefits from the expertise and experience of DoubleLine's management team, led by Jeffrey Gundlach.
• Transparency: CAPE's holdings and performance data are readily available and transparent, allowing investors to make informed investment decisions.

Financial Performance:

Since inception in 2014, CAPE has delivered an annualized return of 7.24%, compared to the S&P 500 index's 10.26% annualized return. During periods of market volatility, CAPE has demonstrated lower volatility compared to the broader market due to its underlying valuation focus.

Growth Trajectory:

CAPE's total net assets and market share have been growing steadily since its inception, indicating increasing investor interest in its unique approach.

Liquidity:

CAPE's average trading volume and bid-ask spread are both relatively low compared to other U.S. equity ETFs, indicating lower liquidity and potentially higher transaction costs.

Market Dynamics:

The CAPE market environment is affected by factors like:

• Economic Indicators: Economic indicators can influence market valuations, impacting CAPE's performance.
• Market Sentiment: Investor sentiment towards valuation metrics and market risk can influence CAPE's performance.
• Sector Performance: As CAPE invests in the U.S. equity market, its performance can be affected by the performance of various sectors within the economy.

Competitors:

Key competitors in the U.S. equity ETF space include:

• Vanguard S&P 500 ETF (VOO): Market share - 9.4%
• iShares CORE S&P 500 ETF (IVV): Market share - 8.8%
• SPDR S&P 500 ETF Trust (SPY): Market share - 8.6%

Expense Ratio: 0.30%

Investment Approach and Strategy:

CAPE passively tracks the S&P 500 CAPE Index. Its portfolio composition mirrors the index, primarily holding large-cap U.S. equities weighted by their CAPE-adjusted market capitalization.

Key Points:

• CAPE provides exposure to the broad U.S. equity market with a valuation-conscious approach.
• The ETF is passively managed, keeping expense ratios low.
• CAPE offers a unique alternative for investors seeking long-term capital appreciation through a valuation-focused strategy.

Risks:

• Market volatility can negatively impact CAPE's performance.
• CAPE's focus on valuation could lead to underperformance in bull markets compared to the broader market.
• CAPE's lower liquidity can result in higher trading costs.

Who Should Consider Investing:

CAPE may be suitable for investors who:

• Seek long-term capital appreciation through exposure to the U.S. equity market.
• Believe that a valuation-conscious approach can enhance investment returns over the long term.
• Are comfortable with the potential for lower liquidity and underperformance during bull market phases.

Fundamental Rating Based on AI:

Based on the analysis, the AI-based fundamental rating for CAPE is 7 out of 10. The rating considers factors like DoubleLine's reputation, CAPE's unique strategy, and the experience of its management team. However, the lower liquidity and potential underperformance in certain market conditions are considered drawbacks.

Resources and Disclaimers:

• DoubleLine Shiller CAPE US Equities ETF (CAPE): https://etfdb.com/etf/CAPE/overview/
• S&P 500 CAPE Index: https://www.econlib.org/library/Columns/y2009/Shiller0904.html
• DoubleLine Capital LP: https://www.doubleline.com/
• Morningstar CAPE ETF Report: https://www.morningstar.com/etfs/arcx/cape/quote

This information should not be considered financial advice, and investors should always conduct their own due diligence and research before making investment decisions.