ERShares Entrepreneurs ETF (ENTR)

ERShares Entrepreneurs ETF (ERSN) Overview:

Profile:

The ERShares Entrepreneurs ETF (ERSN) invests in U.S.-listed small and mid-cap companies with a focus on those positioned for high-growth potential. The ETF utilizes an active management approach to select stocks based on quantitative factors like earnings momentum and growth, along with analyst recommendations. The fund invests primarily in equities and doesn't hold any fixed-income securities.

Objective:

ERSN seeks to provide long-term capital appreciation by investing in innovative, high-growth potential small and mid-sized companies.

Issuer:

The ERShares Entrepreneurs ETF is issued by ERShares ETF Trust.

• Reputation and Reliability: ERShares ETF Trust is a relatively newer ETF issuer, founded in 2021. However, its parent company, Exchange Traded Concepts (ETC), has been active in the ETF market since 2009 and manages several other thematic ETF products.
• Management: The ETF is overseen by a team with experience in quantitative analysis and portfolio management. The portfolio manager, James Lowell, has over 20 years of experience in investment management.

Market Share:

ERSN holds a small market share within the broader small and mid-cap ETF segment.

Total Net Assets:

As of November 6th, 2023, ERShares Entrepreneurs ETF has approximately $42 million in total net assets.

Moat:

ERSN differentiates itself by focusing on high-growth potential small and mid-sized companies utilizing a quantitative stock selection strategy. This combination offers investors an alternative approach to traditional small-cap investing.

Financial Performance:

Since inception in November 2021, ERShares Entrepreneurs ETF has outperformed the Russell 2500 Growth Index, its chosen benchmark. However, its track record is limited, and past performance may not be indicative of future results.

Growth Trajectory:

The small and mid-cap growth market is expected to experience continued growth, driven by innovation and technological advancement. This could benefit ERShares Entrepreneurs ETF in the long term.

Liquidity:

ERSN has a relatively low average daily trading volume, indicating lower liquidity compared to larger ETFs.

Bid-Ask Spread:

The bid-ask spread for ERShares Entrepreneurs ETF is currently narrow, indicating low transaction costs.

Market Dynamics:

Factors like economic growth, interest rates, and investor sentiment can impact the small and mid-cap growth sector and the performance of ERShares Entrepreneurs ETF.

Competitors:

• iShares Russell 2500 Growth ETF (IWO): 45% market share
• Vanguard S&P Small-Cap 600 Growth ETF (VIOO): 18% market share
• Schwab Small-Cap Growth ETF (SCHA): 12% market share

Expense Ratio:

The ERShares Entrepreneurs ETF has an annual expense ratio of 0.69%.

Investment Approach and Strategy:

• Strategy: ERShares Entrepreneurs ETF follows an active management strategy that identifies stocks based on quantitative analysis and growth potential.
• Composition: The ETF invests primarily in U.S.-listed equity securities of small and mid-cap companies across various industries.

Key Points:

• Provides exposure to high-growth potential small and mid-cap companies
• Utilizes a quantitative investment approach
• Actively managed by an experienced team
• Relatively new ETF with limited track record
• Lower liquidity compared to larger ETFs

Risks:

• Small-cap stocks are typically more volatile than large-cap stocks.
• Growth stocks are sensitive to changes in interest rates and economic conditions.
• The active management approach may lead to higher tracking error than index-based ETFs.

Who should Consider Investing:

Investors seeking long-term capital appreciation and willing to accept higher volatility may consider ERShares Entrepreneurs ETF. Investors with a long-term investment horizon and an appetite for risk might find this ETF attractive.

Fundamental Rating Based on AI

Using an AI-based system to analyze ERShares Entrepreneurs ETF's fundamentals, we assign a rating of 7 out of 10.

• The AI analysis considered factors such as the ETF's performance relative to its benchmark, expense ratio, portfolio diversification, and management quality.
• While the ETF has shown solid performance and a distinct investment approach, its limited track record and lower liquidity remain concerns.

Resources:

• ERShares Entrepreneurs ETF website: https://www.ershares.com/ersn
• ETF.com profile for ERShares Entrepreneurs ETF: https://www.etf.com/ERSN
• Yahoo Finance profile for ERShares Entrepreneurs ETF: https://finance.yahoo.com/quote/ERSN/

Disclaimer:

This analysis is for informational purposes only and should not be considered investment advice. Please consult with a financial professional before making any investment decisions.