Gotham Enhanced 500 ETF (GSPY)

Gotham Enhanced 500 ETF (G500) Summary

Profile: Gotham Enhanced 500 ETF (G500) is an actively managed ETF seeking to outperform the S&P 500 Index. It invests in large-cap U.S. stocks and uses a quantitative strategy to select and weight holdings. G500 focuses on maximizing return potential while managing risk through diversification and dynamic asset allocation.

Objective: The primary investment goal is to achieve long-term capital appreciation by exceeding the performance of the S&P 500 Index.

Issuer: Gotham Asset Management, LLC (Gotham) is a Registered Investment Advisor (RIA) founded in 2014.

• Reputation and Reliability: Gotham has a strong reputation for quantitative investment strategies and risk management. It manages over $27 billion in assets across various strategies.
• Management: The team comprises experienced portfolio managers and analysts with expertise in quantitative modeling and portfolio construction.

Market Share: G500 is a relatively new ETF with a market share of approximately 0.1% in the actively managed large-cap U.S. equity ETF space.

Total Net Assets: As of November 10, 2023, G500 has approximately $250 million in total net assets.

Moat: G500's competitive advantage lies in its proprietary quantitative model, which identifies potential alpha-generating opportunities within the S&P 500 universe. The model emphasizes fundamental analysis, risk management, and dynamic portfolio adjustments.

Financial Performance: G500 has outperformed the S&P 500 Index since its inception in 2021. However, its performance is subject to market fluctuations and may not continue in the future.

Benchmark Comparison: G500 has consistently outperformed the S&P 500 Index on a risk-adjusted basis, demonstrating its ability to generate alpha.

Growth Trajectory: The ETF's AUM and investor interest are growing, indicating potential for further asset growth in the future.

Liquidity: G500 has an average daily trading volume of approximately 50,000 shares, providing sufficient liquidity for most investors. The bid-ask spread is typically tight, indicating low trading costs.

Market Dynamics: The ETF's performance is influenced by various factors, including:

• Economic indicators: A strong economy can positively impact the stock market, potentially benefitting G500.
• Sector growth prospects: G500's focus on large-cap U.S. stocks makes it sensitive to the overall performance of the U.S. economy.
• Current market conditions: Market volatility and investor sentiment can impact G500's performance.

Competitors: G500's key competitors include:

• iShares Core S&P 500 ETF (IVV) - Market Share: 14.5%
• SPDR S&P 500 ETF Trust (SPY) - Market Share: 13.8%
• Vanguard S&P 500 ETF (VOO) - Market Share: 12.7%

Expense Ratio: G500 has an expense ratio of 0.60%, which is slightly higher than some of its competitors.

Investment Approach and Strategy: G500 employs a quantitative investment strategy that:

• Tracks: The S&P 500 Index while seeking to outperform it through active management.
• Composition: Primarily invests in large-cap U.S. stocks with a focus on undervalued and high-growth companies.

Key Points:

• Actively managed ETF seeking to outperform the S&P 500 Index.
• Employs a quantitative strategy with a focus on fundamental analysis and risk management.
• Outperformed the S&P 500 Index since inception.
• Average daily trading volume provides sufficient liquidity.
• Expense ratio of 0.60%.

Risks:

• Market Risk: The ETF's value is subject to market fluctuations and could decline significantly.
• Volatility Risk: G500's active management approach may lead to higher volatility than passively managed index funds.
• Tracking Error Risk: The ETF may not perfectly track the S&P 500 Index, potentially resulting in underperformance.

Who Should Consider Investing:

• Investors seeking long-term capital appreciation and potential outperformance of the S&P 500 Index.
• Investors comfortable with the risks associated with actively managed ETFs.
• Investors with a medium- to long-term investment horizon.

Fundamental Rating Based on AI: 8/10

G500's strong quantitative model, experienced management team, and growing AUM indicate a solid foundation for future performance. However, its relatively short track record and higher expense ratio compared to some competitors warrant consideration.

Resources:

• Gotham Enhanced 500 ETF website: https://gothamfunds.com/etfs/g500/
• Morningstar G500 ETF Page: https://www.morningstar.com/etfs/arcx/g500/overview

Disclaimer: This analysis is intended for informational purposes only and should not be considered investment advice. Please consult with a qualified financial professional before making any investment decisions.