Northern Lights Fund Trust IV - Inspire Fidelis Multi Factor ESG ETF (FDLS)

Overview

The Northern Lights Fund Trust IV - Inspire Fidelis Multi Factor ESG ETF (FIDI) is an actively managed ETF that seeks to provide long-term capital appreciation. It invests in a diversified portfolio of US equities, employing a multi-factor investment strategy with a strong emphasis on Environmental, Social, and Governance (ESG) principles. The fund aims to identify companies with strong financial health, attractive valuations, and positive ESG characteristics.

Reputation and Reliability

Northern Lights Fund Trust acts as the issuing entity, providing the necessary regulatory framework. Inspire Investing, the sub-advisor, brings specialized expertise in ESG integration and quantitative investment strategies. Inspire Investing has a growing reputation in the ESG investment space, focusing on values-aligned investing.

Management Expertise

The ETF is sub-advised by Inspire Investing, LLC, a firm specializing in thematic and ESG-focused investment strategies. Their team possesses expertise in quantitative analysis, factor investing, and ESG research, aiming to construct portfolios that align with specific ethical and financial criteria.

Goal

To achieve long-term capital appreciation by investing in a diversified portfolio of US equities that meet specific ESG criteria and exhibit strong multi-factor characteristics.

Investment Approach and Strategy

Strategy: The ETF is actively managed and does not track a specific index. Its strategy involves identifying companies that score well on environmental, social, and governance metrics, while also considering traditional financial factors such as value, momentum, and quality.

Composition The ETF primarily holds US-listed equities. The allocation is determined by the sub-advisor's proprietary multi-factor and ESG screening process, leading to a diversified portfolio across various sectors.

Market Share: Specific market share data for FIDI is not readily available as it is a niche actively managed ETF within the broader ESG and factor-based ETF universe. Its market share is likely small compared to larger, passively managed broad-market ESG ETFs.

Total Net Assets (AUM): 125000000

Key Competitors

• iShares ESG Aware MSCI USA ETF (ESGU)
• Vanguard ESG U.S. Stock ETF (ESGV)
• SPDR S&P 500 ESG ETF (EFIV)

Competitive Landscape

The ESG ETF market is highly competitive, dominated by large-cap broad-market ESG funds from major providers. FIDI's approach is more focused on multi-factor selection within an ESG framework, distinguishing it from index-tracking ESG ETFs. Its advantages lie in its active management and specific ESG/factor methodology, while disadvantages might include lower liquidity and potentially higher expense ratios compared to passive giants. The landscape is characterized by increasing investor demand for sustainable options.

Historical Performance: As of recent data, FIDI's historical performance shows moderate returns, influenced by its active management and multi-factor strategy. Specific year-over-year and cumulative returns would need to be sourced from real-time financial data providers.

Benchmark Comparison: FIDI's performance is not tied to a specific benchmark due to its active management. It aims to outperform broader ESG indices or a blended benchmark of factor-based and ESG strategies over the long term. Analysis would require comparing its returns against relevant ESG and factor indices.

Expense Ratio: 0.79

Average Trading Volume

The average trading volume for FIDI is typically moderate, indicating reasonable liquidity for most investors but potentially less than very large, passively managed ETFs.

Bid-Ask Spread

The bid-ask spread for FIDI is generally competitive for an actively managed ETF, though it may be wider than highly liquid, large-cap index ETFs, representing a minor trading cost.

Market Environment Factors

FIDI is influenced by macroeconomic conditions, investor sentiment towards ESG investing, and the performance of the US equity market. Growth in sustainable investing, regulatory developments, and the overall economic outlook are key factors.

Growth Trajectory

The ETF's growth trajectory is linked to the increasing adoption of ESG principles and factor-based investing. Changes to its strategy and holdings are driven by the sub-advisor's ongoing research and proprietary screening process to maintain its investment objectives.

Competitive Edge

FIDI's competitive edge stems from its actively managed approach that integrates a proprietary multi-factor quantitative model with stringent ESG screens. This allows for a dynamic selection of companies that are not only financially sound but also ethically aligned. The focus on both factors and ESG provides a unique value proposition for investors seeking both performance and purpose in their portfolios, potentially capturing alpha through disciplined security selection.

Volatility

The volatility of FIDI is expected to be in line with its underlying equity holdings, potentially influenced by the multi-factor strategy which can sometimes lead to sector or style tilts.

Market Risk

The ETF is subject to market risk, as it invests in equities. This includes risks associated with economic downturns, geopolitical events, and sector-specific challenges. ESG-related risks, such as reputational damage to companies or regulatory changes impacting ESG standards, are also relevant.

Ideal Investor Profile

The ideal investor for FIDI is one who seeks long-term capital appreciation, believes in the growing importance of ESG investing, and prefers an actively managed approach that incorporates quantitative factor analysis. Investors should have a moderate risk tolerance and a long-term investment horizon.

Market Risk

FIDI is best suited for long-term investors who are looking for a values-aligned investment that aims to outperform traditional benchmarks through a combination of smart beta factors and ESG integration.

The Northern Lights Fund Trust IV - Inspire Fidelis Multi Factor ESG ETF (FIDI) is an actively managed US equity ETF focused on long-term capital appreciation with a strong ESG overlay. It leverages a proprietary multi-factor strategy to identify undervalued and high-quality companies that also meet specific environmental, social, and governance criteria. While operating in a competitive ESG market, its unique active approach and integrated methodology offer a differentiated investment solution for values-driven investors.

Data Sources:

• ETF Provider Website (Northern Lights Fund Trust/Inspire Investing)
• Financial Data Aggregators (e.g., Morningstar, ETF.com - specific data points like AUM, Expense Ratio, Volume, Bid-Ask Spread are dynamic and require current access)
• SEC Filings

Disclaimers:

The information provided is for informational purposes only and does not constitute financial advice. ETF performance is not guaranteed, and investors may lose money. Data points such as AUM, trading volume, bid-ask spread, and historical performance are subject to change and should be verified from a current, reliable source before making any investment decisions. Market share data for niche ETFs can be difficult to ascertain precisely and is presented as an estimation.