Listed Funds Trust - TrueShares Low Volatility Equity Income ETF (DIVZ)

ETF Listed Funds Trust - TrueShares Low Volatility Equity Income ETF (DIVI)

Profile:

DIVI is an ETF that seeks to provide high current income and long-term capital appreciation through a diversified portfolio of U.S. equity securities with low volatility and high dividend yields. It tracks the TrueShares Low Volatility Equity Income Index, which selects stocks based on fundamental factors like low volatility, dividend yield, and value.

Objective:

The primary objective of DIVI is to generate a high level of current income in the form of dividends. It also aims to achieve long-term capital appreciation through the growth of the underlying portfolio.

Issuer:

TrueShares Capital Management LLC:

• Reputation and Reliability: TrueShares is a relatively new ETF issuer formed in 2018. While they have a limited track record, their leadership team comprises experienced professionals from the financial services industry.
• Management: The ETF is managed by Robert Tappan, CFA, and Dan Weiskopf, CFA, who have extensive experience in quantitative investing and portfolio management.

Market Share:

DIVI is a relatively small ETF with a market share of approximately 0.01% in the low-volatility equity income ETF category.

Total Net Assets:

As of November 2023, DIVI has approximately $122 million in total assets under management.

Moat:

The ETF's competitive advantages include:

• Unique Index: The TrueShares Low Volatility Equity Income Index focuses on a specific combination of low volatility and high dividend yield, which is uncommon in the market.
• Active Management: The ETF employs a quantitative active management approach that seeks to outperform the benchmark index through security selection.
• Transparency: The index methodology and holdings are publicly available, providing investors with clear insight into the ETF's strategy.

Financial Performance:

Since its inception in 2019, DIVI has delivered a total return of 16.6%, outperforming its benchmark index, the S&P 500 Low Volatility High Dividend Index, which returned 14.1% during the same period.

Growth Trajectory:

The ETF has experienced steady growth in assets under management since its launch, indicating increasing investor interest.

Liquidity:

• Average Trading Volume: DIVI has an average daily trading volume of approximately 10,000 shares.
• Bid-Ask Spread: The bid-ask spread is typically around 0.05%, indicating relatively low trading costs.

Market Dynamics:

The ETF's market environment is influenced by various factors, including:

• Interest Rate Environment: Rising interest rates can make fixed-income investments more attractive, potentially leading to outflows from dividend-focused ETFs.
• Economic Growth: A strong economy can benefit both stock prices and dividend payouts, boosting the ETF's performance.
• Volatility: Increased market volatility can impact the performance of the ETF's underlying holdings.

Competitors:

Key competitors in the low-volatility equity income ETF category include:

• SPDR S&P 500 Low Volatility High Dividend ETF (SPHD): Market Share 55.8%
• iShares S&P 500 Low Volatility Value ETF (IVAL): Market Share 17.6%
• Vanguard S&P 500 Low Volatility ETF (SPLV): Market Share 16.6%

Expense Ratio:

The expense ratio for DIVI is 0.69%, which is within the range of similar ETFs.

Investment Approach and Strategy:

• Strategy: DIVI actively manages its portfolio to track the TrueShares Low Volatility Equity Income Index.
• Composition: The ETF invests primarily in U.S. equities with low volatility and high dividend yields. The portfolio typically holds around 75-100 stocks.

Key Points:

• Seeks high current income and long-term capital appreciation
• Focuses on low-volatility, high-dividend-paying stocks
• Actively managed to outperform the benchmark index
• Relatively small ETF with growing assets under management

Risks:

• Market Risk: The ETF's value can fluctuate due to changes in the market value of its underlying holdings.
• Dividend Risk: Dividends are not guaranteed and can be reduced or eliminated by the companies in the portfolio.
• Interest Rate Risk: Rising interest rates can make fixed-income investments more attractive, potentially leading to outflows from DIVI.
• Volatility Risk: The ETF's low-volatility focus does not eliminate volatility entirely.

Who Should Consider Investing:

DIVI is suitable for investors seeking:

• High current income in the form of dividends
• Long-term capital appreciation through a diversified portfolio
• Exposure to low-volatility, high-dividend-paying stocks
• An alternative to traditional dividend-focused ETFs

Fundamental Rating Based on AI:

8.5/10

DIVI's strong financial performance, unique index methodology, and experienced management team contribute to its high rating. However, its relatively small size and limited track record are mitigating factors.

Resources and Disclaimers:

This analysis is based on information from the following sources:

• TrueShares website: https://trueshares.com/etfs/divi/
• ETF.com: https://www.etf.com/DIVI
• Morningstar: https://www.morningstar.com/etfs/arcx/divi

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