American Century Sustainable Equity ETF (ESGA)

ETF American Century Sustainable Equity ETF (ASUI) Overview

Profile:

ASUI is an actively managed US large-cap equity ETF that focuses on companies demonstrating environmental, social, and governance (ESG) leadership. It invests in a diversified portfolio of stocks across various sectors, aiming for long-term capital appreciation and income generation. The fund utilizes a proprietary ESG scoring system to identify companies with sustainable practices and strong growth potential.

Objective:

The primary investment goal of ASUI is to achieve long-term capital growth and income generation by investing in a portfolio of sustainable companies with leading ESG practices.

Issuer:

American Century Investments is a leading global asset manager with over $271 billion in assets under management (as of October 31, 2023). The firm has a strong reputation for its sustainable investing expertise and commitment to environmental and social responsibility.

• Reputation and Reliability: American Century Investments holds a strong reputation in the financial industry, earning recognition for its commitment to responsible investing and ESG integration. The firm has received numerous awards and accolades for its sustainable investment strategies and leadership.

• Management: The ETF is managed by an experienced team of portfolio managers with expertise in ESG investing and fundamental analysis. The team utilizes a rigorous research process to identify and select companies that meet their ESG and financial criteria.

Market Share:

ASUI holds a market share of approximately 0.3% within the US Large Cap Equity ESG ETF category.

Total Net Assets:

As of October 31, 2023, ASUI has approximately $1.2 billion in total net assets.

Moat:

• Unique ESG Focus: ASUI's distinct focus on ESG leadership differentiates it from other large-cap equity ETFs.
• Proprietary ESG Scoring System: The fund's proprietary ESG scoring system provides a unique advantage in identifying sustainable companies with strong growth potential.
• Experienced Management Team: The ETF benefits from the expertise of a seasoned management team with a proven track record in ESG investing.

Financial Performance:

Since its inception in February 2020, ASUI has delivered a cumulative return of 15.4% (as of October 31, 2023). This compares favorably to the S&P 500's return of 10.5% over the same period.

Benchmark Comparison:

ASUI has outperformed the S&P 500 Index over the past year, demonstrating its ability to generate alpha while adhering to ESG principles.

Growth Trajectory:

The ETF is experiencing consistent growth in assets under management, indicating increasing investor interest in sustainable investing.

Liquidity:

• Average Trading Volume: ASUI has an average daily trading volume of approximately 20,000 shares, ensuring sufficient liquidity for investors.
• Bid-Ask Spread: The ETF's average bid-ask spread is around 0.05%, indicating low trading costs.

Market Dynamics:

• Growing Demand for ESG Investing: The demand for sustainable investments is rapidly increasing, driving the growth of ESG-focused ETFs like ASUI.
• Favorable Regulatory Environment: Governments and regulatory bodies are increasingly promoting sustainable investing, creating a supportive environment for ESG-focused funds.

Competitors:

• iShares ESG Aware MSCI USA ETF (ESGU)
• Xtrackers MSCI USA ESG Leaders Equity ETF (USSG)
• Vanguard ESG US Stock ETF (ESGV)

Expense Ratio:

The expense ratio for ASUI is 0.30%, which is considered competitive within the ESG-focused large-cap equity ETF category.

Investment Approach and Strategy:

• Strategy: ASUI actively manages its portfolio to identify and invest in companies demonstrating ESG leadership.
• Composition: The ETF primarily invests in large-cap US stocks across various sectors, with a focus on companies with strong ESG ratings and growth potential.

Key Points:

• Actively managed ESG-focused large-cap equity ETF.
• Invests in companies with strong environmental, social, and governance practices.
• Seeks long-term capital appreciation and income generation.
• Experienced management team with a proven track record in ESG investing.
• Outperformed the S&P 500 over the past year.
• Growing assets under management and increasing investor interest.

Risks:

• Market Risk: ASUI is exposed to the overall market risks associated with the US stock market.
• ESG Risk: The performance of the ETF may be impacted by changes in ESG standards and regulations.
• Active Management Risk: The ETF's performance depends on the success of the management team's investment decisions.

Who Should Consider Investing:

Investors seeking long-term capital appreciation and income generation while aligning their investments with sustainable principles should consider ASUI. The ETF is suitable for investors with a medium to high risk tolerance and a long-term investment horizon.

Fundamental Rating Based on AI:

Based on an AI-based analysis of the factors mentioned above, ASUI receives a 7 out of 10 rating. The ETF's strong ESG focus, experienced management team, and competitive performance position it favorably within the ESG-focused large-cap equity ETF category. However, investors should be aware of the potential risks associated with active management and market volatility.

Resources and Disclaimers:

• American Century Investments website: https://www.americancentury.com/individual/etfs/asui
• Morningstar: https://www.morningstar.com/etfs/arcx/asui/quote
• Yahoo Finance: https://finance.yahoo.com/quote/ASUI/
• Disclaimer: This information is for educational purposes only and should not be considered financial advice. Please consult with a financial professional before making any investment decisions.