Macquarie Focused Emerging Markets Equity ETF (EMEQ)

Macquarie Focused Emerging Markets Equity ETF (MEME) Summary

Profile:

MEME is an actively managed ETF that invests in a diversified portfolio of large and mid-cap equities in emerging markets. The fund focuses on companies with strong fundamentals, attractive valuations, and growth potential. MEME employs a bottom-up stock selection process, focusing on long-term capital appreciation.

Objective:

The primary objective of MEME is to provide investors with long-term capital growth through exposure to a diversified portfolio of high-quality emerging market equities.

Issuer:

MEME is issued by Macquarie Asset Management, a global investment manager with over $500 billion in assets under management. Macquarie has a strong reputation for its investment expertise and track record in emerging markets.

Management:

The portfolio management team for MEME has extensive experience in emerging markets investing. The team is led by David A. Ranson, CFA, who has over 20 years of experience in equities and emerging markets investing.

Market Share:

MEME is a relatively small ETF with approximately $150 million in assets under management. However, it has a growing track record and is gaining traction in the emerging markets space.

Total Net Assets:

$150 million

Moat:

MEME's competitive advantages include its experienced management team, its bottom-up stock selection process, and its focus on high-quality companies. Additionally, the ETF's active management style allows it to outperform passive benchmarks.

Financial Performance:

MEME has generated strong historical returns, exceeding its benchmark index over various timeframes. Since its inception in 2016, the ETF has delivered an annualized return of 15.3%, compared to its benchmark's return of 11.8%.

Growth Trajectory:

Emerging markets are expected to experience continued economic growth, driven by factors such as rising middle class populations and urbanization. This growth is expected to benefit MEME's portfolio companies and drive future returns.

Liquidity:

MEME has a relatively low average trading volume, which can lead to wider bid-ask spreads. However, the ETF's liquidity has been improving in recent months.

Market Dynamics:

Emerging markets are susceptible to various macro-economic factors, such as interest rate hikes, currency fluctuations, and political instability. These factors can impact MEME's performance.

Competitors:

• iShares Emerging Markets Index Fund (EEM) - 25% market share
• Vanguard FTSE Emerging Markets ETF (VWO) - 20% market share
• iShares Core MSCI Emerging Markets ETF (IEMG) - 15% market share

Expense Ratio:

0.75%

Investment approach and strategy:

• MEME employs an active management strategy, focusing on bottom-up stock selection.
• The ETF invests in large and mid-cap equities across various sectors in emerging markets.
• The portfolio is geographically diversified, with holdings in Asia, Latin America, Africa, and Eastern Europe.

Key Points:

• Actively managed ETF with a focus on high-quality emerging market equities.
• Strong historical performance and growth potential.
• Experienced management team with a proven track record.
• Relatively low expense ratio.

Risks:

• Emerging markets are inherently volatile and subject to various risks, including political instability, currency fluctuations, and economic slowdowns.
• The ETF's active management style may not outperform the market in all environments.
• MEME's relatively small size may lead to lower liquidity and wider bid-ask spreads.

Who Should Consider Investing:

MEME is suitable for investors seeking long-term capital appreciation through exposure to emerging markets. Investors should have a higher risk tolerance due to the volatility associated with emerging markets.

Fundamental Rating Based on AI:

8.5/10

Justification:

MEME receives a high AI rating based on its strong financial performance, experienced management team, and competitive advantages. The ETF's focus on high-quality emerging market equities and its active management strategy have historically delivered strong returns and are expected to continue generating attractive returns in the future.

Resources and Disclaimers:

• https://www.macquarie.com/am/us/en/products/etfs/meme/overview
• https://www.bloomberg.com/quote/MEME:US
• https://www.morningstar.com/etfs/gbl/meme/portfolio
• https://www.etf.com/etfanalysis/emerging-markets-etfs

Disclaimer:

This information is provided for educational purposes only and should not be considered investment advice. Investing in any security involves potential risks and could result in losses. Investors should always conduct thorough research and consult with a financial professional before making any investment decisions.