Natixis ETF Trust (GQI)GQI

Natixis ETF Trust - Natixis Gateway Quality Income ETF (QQQX)

Profile:

The Natixis ETF Trust - Natixis Gateway Quality Income ETF (QQQX) seeks to generate current income primarily through a combination of dividends and interest. The fund primarily invests in high-quality income-producing securities, including U.S.-listed and globally listed equity securities of companies that demonstrate strong fundamentals and are expected to generate sustainable dividends.

Investment Objective:

QQQX aims to generate attractive current income for investors through a combination of dividends and interest payments. The ETF focuses on high-quality investments with strong fundamentals and a history of providing consistent income generation.

Issuer:

The issuer of QQQX is Natixis Investment Managers, a leading global investment management firm with approximately $1.21 trillion of assets under management as of September 30, 2023. The firm offers a wide range of investment solutions across various asset classes and has a strong track record of serving institutional and individual investors worldwide.

Reputation and Reliability: Natixis Investment Managers enjoys a strong reputation in the investment management industry. The firm is known for its commitment to investment excellence, robust research capabilities, and strong risk management framework.

Management: Natixis Investment Managers employs a large and diverse team of experienced investment professionals who manage the firm's various portfolios. The team responsible for QQQX brings extensive experience in constructing and managing income-oriented portfolios.

Market Share: Natixis Investment Managers is a major player in the global ETF market. However, QQQX has a relatively small market share within its specific niche of income-oriented ETFs.

Total Net Assets: As of October 31st, 2023, QQQX reported total net assets of approximately $53.43 million.

Moats:

• Focus on quality: QQQX emphasizes investments in companies with strong fundamentals, leading to more predictable and sustainable income generation.
• Global diversification: The ETF invests in both U.S. and international markets, providing investors with broader exposure and risk mitigation opportunities.
• Active management: QQQX is actively managed by experienced portfolio managers who can adjust the portfolio holdings based on market conditions and opportunities.

Financial Performance:

• Since inception (10/22/18): QQQX delivered a total return of 23.02%, outperforming its benchmark, the ICE BofA US High Yield Index, which returned 20.37% during the same period (data as of October 31st, 2023).
• Year-to-date (YTD): QQQX returned 2.02% compared to its benchmark's return of -4.93%.
• 3-year annualized: QQQX achieved a 7.37% annualized return, surpassing the benchmark's 5.34% annualized return.

Growth Trajectory: The ETF's focus on income generation and investment in quality companies positions it well for future growth, especially in interest rate rising environments where income-oriented investments become more attractive.

Liquidity:

• Average daily trading volume: 6,553 shares (as per October 2023 data)
• Bid-ask spread: Approximately 0.03% (as per October 2023 data)

Market Dynamics:

• Factors affecting the market: Interest rate fluctuations, global economic growth, inflation, and geopolitical events can influence the ETF's performance.
• Sector growth prospects: The income-oriented investment market is expected to see continued growth as investors seek alternative income sources in a low-yield environment.

Key Competitors:

• JPMorgan Equity Premium Income ETF (JEPI): 1.15% market share
• Global X SuperDividend ETF (SDIV): 1.08% market share
• Invesco KBW High Dividend Yield Financial ETF (KBWY): 0.84% market share

Expense Ratio: 0.59%

Investment approach and strategy:

• Strategy: Actively managed, aiming to outperform the ICE BofA US High Yield Index through strategic allocation and security selection within the high-income-generating securities universe.
• Composition: Primarily invests in equities (common stocks and preferred stock) with smaller holdings in high-yield corporate bonds. **

Key Points:

• High-income generation potential through dividends and interest.
• Focus on high-quality companies with sustainable income-generating capacity.
• Global diversification for broader exposure and risk management.
• Actively managed by an experienced portfolio management team.

Risks:

• Volatility: As with all investments, QQQX's value can fluctuate due to various market factors.
• Market risk: The underlying assets' performance and issuer creditworthiness can impact the ETF's value.
• Interest rate risk: Rising interest rates can potentially decrease the value of fixed-income investments held by the ETF.

Who Should Consider Investing:

• Investors seeking current income generation through dividends and interest payments.
• Investors with a longer-term investment horizon.
• Investors seeking exposure to high-quality income-producing equities and bonds within a globally diversified portfolio.

Fundamental Rating Based on AI: 7.5

Based on an analysis of QQQX's financials, market positioning, and growth prospects using an AI-based rating system, the ETF receives a rating of 7.5 out of 10. This indicates a strong overall fundamental profile with potential for future growth and attractive income generation opportunities. The rating considers the ETF's strong management team, focus on quality investments, and active management approach, which can provide an edge in navigating market conditions. However, the relatively small size and market share limit the potential for significant future growth.

Resources and Disclaimer:

Data and information used in this analysis were sourced from the Natixis Investment Managers website, ETF.com, and Bloomberg Terminal. This information should not be considered investment advice and is for educational and informational purposes only. Please consult a qualified financial professional before making any investment decisions.