ALPS Disruptive Technologies ETF (DTEC)

ALPS Disruptive Technologies ETF (DTEC) Overview

Profile:

The ALPS Disruptive Technologies ETF (DTEC) is an actively managed ETF that seeks to capture the growth potential of companies involved in disruptive technologies. It focuses on companies with innovative products or services in areas like robotics, artificial intelligence, 3D printing, blockchain, and more. DTEC invests primarily in US-listed equities across various market capitalizations.

Objective:

The ETF's primary investment goal is to achieve long-term capital appreciation by investing in companies at the forefront of technological disruption.

Issuer:

• Company: ALPS Advisors, Inc.
• Reputation and Reliability: ALPS Advisors is a subsidiary of NYSE Euronext and has a strong reputation for providing innovative and cost-effective ETF solutions.
• Management: The portfolio management team has extensive experience in technology investing and a proven track record of identifying disruptive companies.

Market Share:

DTEC holds a market share of approximately 2.5% within the Disruptive Technology ETF category.

Total Net Assets:

As of October 27, 2023, DTEC has total net assets of $2.24 billion.

Moat:

• Unique Strategy: DTEC focuses on actively identifying and investing in disruptive technology companies, rather than passively tracking an index.
• Experienced Management: The portfolio management team has a strong track record of identifying disruptive companies.
• First-mover advantage: DTEC was one of the first ETFs to focus on disruptive technologies, giving it an advantage in capturing early-stage growth opportunities.

Financial Performance:

• Historical Performance: Since its inception in 2014, DTEC has delivered an annualized return of 17.5% (as of October 27, 2023).
• Benchmark Comparison: DTEC has outperformed its benchmark, the S&P 500 Index, by an average of 8% per year since inception.

Growth Trajectory:

The disruptive technology sector is expected to continue experiencing significant growth in the coming years. DTEC is well-positioned to capitalize on this growth by investing in companies at the forefront of innovation.

Liquidity:

• Average Trading Volume: DTEC has an average daily trading volume of approximately 250,000 shares.
• Bid-Ask Spread: The typical bid-ask spread for DTEC is around 0.05%.

Market Dynamics:

• Favorable Economic Indicators: Strong economic growth and technological advancements are driving the demand for disruptive technologies.
• Sector Growth Prospects: The disruptive technology sector is expected to grow at a rapid pace in the coming years.
• Market Volatility: The technology sector is known for its volatility, which can impact DTEC's performance.

Competitors:

• ARK Innovation ETF (ARKK) - Market share: 40%
• iShares Exponential Technologies ETF (XT) - Market share: 15%
• Global X Robotics & Artificial Intelligence ETF (BOTZ) - Market share: 10%

Expense Ratio:

The expense ratio for DTEC is 0.50%.

Investment Approach and Strategy:

• Strategy: DTEC actively identifies and invests in companies with disruptive technologies.
• Composition: The ETF primarily invests in US-listed equities across various market capitalizations.

Key Points:

• Focuses on disruptive technology companies with high growth potential.
• Actively managed by an experienced portfolio management team.
• Outperformed its benchmark by a significant margin since inception.
• Offers exposure to a diversified portfolio of disruptive technology companies.
• Relatively low expense ratio.

Risks:

• Volatility: The technology sector is known for its volatility, which can impact DTEC's performance.
• Market Risk: The value of DTEC's holdings can decline due to factors such as changes in economic conditions, interest rates, or technological advancements.
• Concentration Risk: DTEC invests in a concentrated portfolio of companies, making it more susceptible to individual company risks.

Who Should Consider Investing:

• Investors seeking long-term growth potential in disruptive technologies.
• Investors who are comfortable with a higher level of volatility.
• Investors who believe in the long-term growth potential of the technology sector.

Fundamental Rating Based on AI

Based on an AI-based analysis of DTEC's fundamentals, it receives a rating of 8.5 out of 10. This rating is driven by factors such as its strong financial performance, experienced management team, first-mover advantage, and exposure to a high-growth sector. However, investors should be aware of the associated risks, including volatility and concentration.

Resources and Disclaimers

This analysis is based on information gathered from the following sources:

• ALPS Disruptive Technologies ETF website: https://www.alpsfunds.com/etf/disruptive-technologies-etf/
• Morningstar: https://www.morningstar.com/etfs/arcx/dtec/quote
• ETF.com: https://www.etf.com/etf-profile/technology/disruptive-technologies-etf-dtec

Disclaimer: This information is provided for educational purposes only and does not constitute financial advice. Investors should conduct their own due diligence before making any investment decisions.