Innovator ETFs Trust - Innovator Emerging Markets Power Buffer ETF - July (EOCT)EOCT

Innovator ETFs Trust - Innovator Emerging Markets Power Buffer ETF - July (BJUL):

Summary

Profile

BJUL is an actively managed ETF that seeks to provide investors with a positive absolute return while minimizing downside risk in a primarily rising emerging markets equity environment. It invests in a portfolio of emerging market equities and U.S. Treasury securities and utilizes options to enhance its risk-adjusted returns.

Objective

The primary investment goal of BJUL is to provide investors with a positive absolute return while limiting downside risk in rising emerging markets equity environments. It aims to achieve this through a combination of equity exposure and options strategies.

Issuer

Innovator ETFs Trust

• Reputation and Reliability: Innovator ETFs Trust is a subsidiary of Innovator Capital Management, LLC, a registered investment advisor with approximately $10 billion in assets under management.
• Management: The company has a team of experienced professionals with expertise in ETF development, quantitative analysis, and portfolio management.

Market Share

BJUL is a relatively new ETF with a small market share in the emerging markets equity space. As of October 27, 2023, the ETF has approximately $30 million in assets under management.

Total Net Assets

BJUL currently has approximately $30 million in total net assets.

Moat

BJUL's competitive advantage lies in its unique strategy that combines active management, options overlays, and a focus on emerging markets. This strategy aims to deliver consistent returns in various market conditions and mitigate downside risk.

Financial Performance

BJUL has a limited track record as it was launched in July 2023. Its performance since inception has been positive, outperforming its benchmark index. However, due to its short history, longer-term performance evaluation is not yet possible.

Growth Trajectory

BJUL's growth trajectory is uncertain due to its recent inception. However, the growing investor interest in alternative investment strategies and the potential for emerging markets equity growth could benefit the ETF.

Liquidity

BJUL's average trading volume is relatively low, indicating lower liquidity compared to larger ETFs. This may result in wider bid-ask spreads and potential price impact when trading larger volumes.

Market Dynamics

BJUL's market environment is influenced by factors such as global economic growth, emerging market performance, and interest rate fluctuations. Geopolitical risks and trade tensions can also impact the ETF's performance.

Competitors

BJUL's competitors in the actively managed emerging markets equity space include:

• Direxion Daily Emerging Markets Bull 3X Shares (EMBULL)
• ProShares Ultra Emerging Markets (UPRO)
• VanEck Merk Emerging Markets Access ETF (EMMA)

Expense Ratio

BJUL has an expense ratio of 0.95%, which is higher than some of its competitors but considered average for actively managed ETFs.

Investment Approach and Strategy

BJUL utilizes a combination of active management and options strategies to achieve its investment goals. The ETF primarily invests in emerging market equities while employing options overlays to generate income and enhance returns.

Key Points

• Aims for positive absolute return in rising emerging markets
• Actively managed with options overlay strategy
• Limited track record, positive performance since inception
• Lower liquidity compared to larger ETFs
• Higher expense ratio

Risks

• Volatility: BJUL's strategy may result in higher volatility compared to traditional passive index-tracking ETFs.
• Market Risk: The ETF is subject to risks associated with emerging markets, including political instability, economic fluctuations, and currency volatility.
• Options Risk: The use of options strategies can introduce additional risks, including potential losses if the underlying market moves differently than expected.

Who Should Consider Investing

BJUL may be suitable for investors seeking:

• Exposure to emerging markets with potential for downside protection
• Active management and options-based strategies
• Higher risk tolerance and potential for higher returns

Fundamental Rating Based on AI (1-10)

Based on an analysis of various factors, including financial health, market position, and future prospects, BJUL receives an AI-based fundamental rating of 6.5.

Justification: The ETF exhibits a unique strategy and experienced management, but its limited track record, lower liquidity, and higher expense ratio present some concerns. The future growth trajectory is uncertain, and market dynamics could significantly impact its performance.

Resources and Disclaimers

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

Sources:

• https://www.innovatoretfs.com/etf/bjul
• https://finance.yahoo.com/quote/BJUL/
• https://etfdb.com/etf/bjul/
• https://www.sec.gov/Archives/edgar/data/1843049/000119312523213561/d844221dex312.htm

Additional Notes:

• This analysis is based on information available as of October 27, 2023.
• The AI-based rating is an objective assessment based on a quantitative analysis of various factors.