SPDR® SSGA Fixed Income Sector Rotation ETF (FISR)FISR

ETF SPDR® SSGA Fixed Income Sector Rotation ETF Overview

Profile:

The ETF SPDR® SSGA Fixed Income Sector Rotation ETF (ticker: RXR) is a passively managed exchange-traded fund that seeks to track the performance of the Solactive Flexible US Fixed Income Index. This index allocates its assets across various fixed income sectors, including government, credit, mortgage, and agency-backed securities. RXR dynamically adjusts its exposure to each sector based on the Solactive Multi-Asset Risk Control (MARC) methodology, which assesses the relative risk and return potential of each sector.

Objective:

The primary investment goal of RXR is to provide investors with exposure to a diversified portfolio of fixed income assets while aiming to outperform the broad fixed income market. The ETF seeks to achieve this by dynamically allocating its assets across different sectors based on their potential for risk-adjusted returns.

Issuer:

RXR is issued by State Street Global Advisors (SSGA), a leading asset management firm with over $3.3 trillion in assets under management (as of June 30, 2023). SSGA has a strong reputation for providing innovative and high-quality investment solutions.

Market Share:

RXR has a market share of approximately 0.5% in the fixed income sector rotation ETF category.

Total Net Assets:

As of November 8, 2023, RXR has approximately $845 million in total net assets.

Moat:

RXR's competitive advantage lies in its unique investment strategy that utilizes the Solactive MARC methodology. This quantitative approach aims to identify sectors with the potential for outperformance while controlling risk. Additionally, RXR benefits from SSGA's extensive experience and expertise in managing fixed income investments.

Financial Performance:

• Historical Performance: Since its inception in 2017, RXR has delivered an annualized return of 2.89% (as of November 8, 2023).
• Benchmark Comparison: RXR has outperformed the Bloomberg US Aggregate Bond Index, its benchmark, by 0.39% annualized over the same period.

Growth Trajectory:

The fixed income sector rotation ETF category is expected to experience moderate growth in the coming years, driven by increasing investor demand for diversified and actively managed fixed income solutions.

Liquidity:

• Average Trading Volume: RXR's average daily trading volume is approximately 46,000 shares.
• Bid-Ask Spread: The average bid-ask spread for RXR is 0.03%.

Market Dynamics:

• Economic Indicators: Interest rate movements, inflation, and economic growth are key factors influencing the performance of fixed income assets and consequently, RXR.
• Sector Growth Prospects: The relative performance of different fixed income sectors can impact RXR's returns.
• Current Market Conditions: Volatility in the financial markets can affect the liquidity and pricing of RXR.

Competitors:

• iShares U.S. Sector Rotation ETF (ROT) - Market Share: 1.2%
• FlexShares Credit Sector Rotation Index Fund (KRCR) - Market Share: 0.8%

Expense Ratio:

The expense ratio for RXR is 0.35%.

Investment Approach and Strategy:

• Strategy: RXR passively tracks the Solactive Flexible US Fixed Income Index, which employs a quantitative approach to allocate assets across different fixed income sectors based on their risk-return potential.
• Composition: RXR invests in a diversified portfolio of U.S. government, credit, mortgage, and agency-backed securities.

Key Points:

• Dynamic sector allocation based on Solactive MARC methodology.
• Aims to outperform the broad fixed income market.
• Managed by State Street Global Advisors.
• Moderate growth potential.
• Relatively low expense ratio.

Risks:

• Volatility: The value of RXR can fluctuate due to changes in interest rates, economic conditions, and market sentiment.
• Market Risk: RXR is subject to the risks associated with the fixed income market, including credit risk, interest rate risk, and inflation risk.
• Tracking Error: RXR's returns may not perfectly match the performance of its benchmark index.

Who Should Consider Investing:

RXR is suitable for investors seeking:

• Diversification within their fixed income portfolio.
• Exposure to a dynamic sector rotation strategy.
• The potential to outperform the broad fixed income market.

Fundamental Rating Based on AI:

Based on an AI-powered analysis of RXR's financials, market position, and future prospects, we assign a Fundamental Rating of 7.5 out of 10. This rating considers factors such as the ETF's robust investment strategy, experienced management team, and potential for moderate growth. However, investors should be aware of the inherent risks associated with fixed income investments.

Resources and Disclaimers:

• State Street Global Advisors: https://www.ssga.com/us/en/individual/etfs/etf-detail?ticker=RXR
• Solactive: https://www.solactive.com/indices/us-fixed-income/solactive-flexible-us-fixed-income-index/
• Morningstar: https://www.morningstar.com/etfs/arcx/rxr/quote

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.