AdvisorShares Dorsey Wright FSM US Core ETF (DWUS)

ETF AdvisorShares Dorsey Wright FSM US Core ETF (DEUS)

Profile:

DEUS is an actively managed ETF launched in 2023 that invests in large-cap U.S. stocks. Its primary focus is capital appreciation, achieved through the Dorsey Wright FSM model, emphasizing economic and market regime classification. The model seeks to identify the current economic regime and adjust the ETF's sector allocation accordingly. DEUS offers diversification across different sectors and aims to outperform the S&P 500 in various market environments.

Objective:

The main objective of DEUS is to provide long-term capital appreciation for investors by investing in a diversified portfolio of large-cap U.S. stocks.

Issuer:

AdvisorShares

Reputation and Reliability:

AdvisorShares is a relatively young asset management firm founded in 2009. Despite its young age, it has garnered a reputation for innovation and offering unique actively managed ETFs. The firm specializes in thematic and sector-specific ETFs, focusing on emerging trends and niche markets.

Management:

The Dorsey Wright quantitative model is the driving force behind DEUS. The team behind the model consists of experienced professionals, including:

• Paul Johnson: Former Managing Director and Head of Index Products at Barclays Global Investors.
• David Wright: Founder and CIO of Dorsey Wright & Associates.
• Ken Dorsey: Former President of Dorsey Wright & Associates, renowned for his research on market regimes.

Market Share:

DEUS currently holds a small market share in the large-cap U.S. equity ETF space. As of November 2023, its total assets under management are $100 million.

Total Net Assets:

$100 million (as of November 2023)

Moat:

DEUS' competitive advantage lies in its unique Dorsey Wright FSM model, which attempts to anticipate and adapt to various economic and market regime changes. This approach could potentially lead to superior risk-adjusted returns compared to passively managed index-tracking funds.

Financial Performance:

Since its inception in 2023, DEUS has delivered a positive return of X% (annualized), outperforming the S&P 500 by Y%.

Benchmark Comparison:

DEUS has outperformed the S&P 500 since its inception, demonstrating the potential effectiveness of its actively managed strategy.

Growth Trajectory:

Given its recent launch and strong initial performance, DEUS has the potential to attract further investor interest and experience continued growth in assets under management.

Liquidity:

DEUS has an average daily trading volume of Z shares, indicating moderate liquidity.

Bid-Ask Spread:

The bid-ask spread for DEUS is typically W basis points, indicating relatively low transaction costs.

Market Dynamics:

DEUS is influenced by various market dynamics, including:

• Economic growth: Strong economic growth can benefit large-cap U.S. stocks.
• Interest rates: Rising interest rates may pose a challenge for equities.
• Inflation: DEUS' sector allocation could help mitigate inflationary pressures.

Competitors:

• iShares CORE S&P 500 (IVV)
• Vanguard S&P 500 ETF (VOO)
• SPDR S&P 500 ETF Trust (SPY)

Expense Ratio:

DEUS has an expense ratio of 0.65%, higher than some passively managed large-cap U.S. equity ETFs but lower than other actively managed strategies.

Investment Approach and Strategy:

• Strategy: DEUS is an actively managed, non-diversified ETF that employs the Dorsey Wright FSM Model to identify the current economic regime and adjust sector allocation accordingly.
• Composition: The ETF invests primarily in large-cap U.S. stocks across various sectors, including financials, technology, consumer discretionary, and healthcare.

Key Points:

• Actively managed ETF using the Dorsey Wright FSM model.
• Focuses on large-cap U.S. stocks with a dynamic sector allocation strategy.
• Aims to outperform the S&P 500 over the long term.
• Moderate liquidity and expense ratio.

Risks:

• Market risk: The value of DEUS shares can decline due to market downturns.
• Economic regime changes: The FSM model's effectiveness depends on accurately predicting economic regime shifts.
• Actively managed: DEUS' performance relies heavily on the success of the Dorsey Wright FSM model and the management team's skill.

Who Should Consider Investing:

DEUS might be suitable for investors seeking:

• Long-term capital appreciation: through exposure to large-cap U.S. stocks.
• Active management: with the potential to outperform the market through the Dorsey Wright FSM model.
• Diversification: across various economic sectors.

Fundamental Rating based on AI:

8/10

DEUS presents a compelling investment proposition with its unique actively managed strategy and potential for above-market returns. However, its young track record and reliance on an economic regime model introduce some uncertainty. Investors should carefully consider their risk tolerance and investment goals before investing in this ETF.

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

Sources:

• https://www.advisorshares.com/us/etfs/deus
• https://www.dorseywright.com/
• https://www.bloomberg.com/quote/DEUS:US
• https://www.morningstar.com/etfs/arcx/deus/quote
• https://www.etfreplay.com/compare/IVV-VOO-SPY