Arrow DWA Tactical: Macro ETF (DWAT)

Overview

The Arrow DWA Tactical: Macro ETF (DWAT) is an actively managed ETF that seeks long-term capital appreciation by tactically allocating assets across various global macro themes based on Dorsey Wright's relative strength methodology.

Reputation and Reliability

Arrow Investment Management is a known issuer, but relatively smaller compared to major ETF providers like BlackRock or Vanguard. Their reliability is considered good within their scope.

Management Expertise

The management team uses the Dorsey Wright relative strength methodology, a momentum-based approach. Their expertise lies in identifying and capitalizing on trending assets and sectors.

Goal

To achieve long-term capital appreciation by tactically allocating assets based on relative strength.

Investment Approach and Strategy

Strategy: Actively managed, using Dorsey Wright's relative strength methodology to identify assets with strong momentum. It dynamically shifts allocations among different asset classes based on perceived market trends.

Composition The ETF holds a mix of other ETFs representing different asset classes, sectors, and geographies. The specific holdings change frequently based on the tactical allocations.

Market Share: Relatively small market share within the tactical allocation ETF space.

Total Net Assets (AUM): 23160000

Key Competitors

• AOA
• AOM
• AOR
• AOK

Competitive Landscape

The tactical allocation ETF industry is dominated by larger, more established ETFs that passively track asset allocation benchmarks. DWAT differentiates itself through its active management and relative strength approach, but faces the challenge of demonstrating consistent outperformance to justify its higher expense ratio. Its smaller size also means lower liquidity compared to its competitors.

Historical Performance: Historical performance data needs to be gathered from financial data providers to populate this section. Performance will vary greatly based on its tactical allocations.

Benchmark Comparison: Performance comparison against a relevant benchmark, such as a diversified global index or a multi-asset benchmark, will be crucial to assessing its effectiveness. This will be populated based on available historical performance data.

Expense Ratio: 0.75

Average Trading Volume

Average trading volume is relatively low, indicating moderate liquidity.

Bid-Ask Spread

The bid-ask spread can vary, but generally is moderate reflecting its smaller size.

Market Environment Factors

Economic indicators, global growth prospects, interest rate movements, and geopolitical events influence the underlying asset classes held by DWAT. Market sentiment also plays a role in the performance of the relative strength strategy.

Growth Trajectory

Growth is dependent on successful tactical asset allocation and the ability to capitalize on market trends. Changes in holdings are dictated by the Dorsey Wright methodology.

Competitive Edge

DWAT's competitive advantage lies in its active management using the Dorsey Wright relative strength methodology, aiming to identify and capitalize on market trends. This approach differentiates it from passive asset allocation ETFs. The fund's ability to adapt to changing market conditions quickly is another advantage. However, the success hinges on the effectiveness of the chosen methodology and the management team's ability to execute it.

Volatility

Volatility is expected to be dependent on the volatility of the underlying asset classes and the frequency of tactical shifts.

Market Risk

Market risk stems from the potential for losses across asset classes due to economic downturns, geopolitical events, or other systemic factors. The ETF is also subject to the risks associated with active management and the potential for misjudging market trends.

Ideal Investor Profile

Investors seeking active management and tactical asset allocation with a higher risk tolerance and a desire for capital appreciation would be the ideal investor.

Market Risk

Best suited for active traders or those who seek tactical exposure, rather than passive index followers or long-term buy-and-hold investors.

The Arrow DWA Tactical: Macro ETF (DWAT) is an actively managed ETF employing a relative strength strategy to tactically allocate assets across global macro themes. Its performance hinges on the success of the Dorsey Wright methodology and the management team's execution. While offering the potential for outperformance through active management, it also carries higher risk and expense compared to passive alternatives. DWAT is best suited for investors seeking tactical exposure and willing to tolerate higher volatility in pursuit of capital appreciation.

Data Sources:

• arrowetfs.com
• etf.com
• Morningstar

Disclaimers:

This analysis is based on available information and should not be considered financial advice. Investment decisions should be made based on individual circumstances and a thorough understanding of the ETF's prospectus and risks.