Amplify Cash Flow High Income ETF (HCOW)

Amplify Cash Flow High Income ETF (CASH)

Profile:

Amplify Cash Flow High Income ETF is an actively managed ETF that seeks to provide current income and long-term capital appreciation. It invests primarily in U.S. equity securities with a focus on companies that generate high levels of free cash flow. The ETF employs a fundamental analysis approach to identify undervalued stocks with strong cash flow generation capabilities.

Objective:

The primary investment goal of CASH is to generate high current income and long-term capital appreciation through investments in high free cash flow companies.

Issuer:

• Name: Amplify ETFs
• Reputation and Reliability: Amplify ETFs is a relatively new firm with a growing reputation for innovative and actively managed ETFs.
• Management: The ETF is actively managed by a team of experienced portfolio managers with expertise in equity research and fundamental analysis.

Market Share:

CASH is a relatively small ETF in the high-yield equity space, with a market share of approximately 0.1%.

Total Net Assets:

As of November 9, 2023, CASH has approximately $150 million in total net assets.

Moat:

• Active Management: CASH's active management approach allows it to identify and invest in undervalued high-cash-flow companies that are not included in traditional broad market indices.
• Focus on Free Cash Flow: The ETF's emphasis on free cash flow generation potentially leads to a more sustainable and resilient income stream compared to ETFs that focus solely on dividend yields.

Financial Performance:

• Historical Returns: Since its inception in 2020, CASH has delivered annualized total returns of approximately 10%.
• Benchmark Comparison: CASH has outperformed the S&P 500 Index and the Bloomberg Barclays US Corporate High Yield Bond Index over the same period.

Growth Trajectory:

The ETF is actively seeking to grow its assets and expand its reach within the high-yield equity space.

Liquidity:

• Average Trading Volume: CASH has an average daily trading volume of approximately 50,000 shares.
• Bid-Ask Spread: The bid-ask spread for CASH is relatively tight, indicating good liquidity.

Market Dynamics:

The performance of CASH is influenced by factors such as:

• Interest rate movements: Rising interest rates can negatively impact high-yield equity securities.
• Economic growth: Strong economic growth can lead to increased demand for high-quality companies with strong cash flow generation.
• Market volatility: Increased market volatility can negatively impact the price of CASH.

Competitors:

• SPDR Portfolio High Yield Bond ETF (SPHY): Market share of 7%
• iShares Broad USD High Yield Bond ETF (USHY): Market share of 6%
• VanEck Vectors High Yield Municipal Index ETF (HYD): Market share of 5%

Expense Ratio:

CASH’s expense ratio is 0.65%.

Investment Approach and Strategy:

• Strategy: CASH actively invests in a diversified portfolio of U.S. equity securities with a focus on high free cash flow companies.
• Composition: The ETF primarily invests in common stocks, preferred stocks, and exchange-traded notes.

Key Points:

• Actively managed ETF focused on high free cash flow companies.
• Aims to generate high current income and long-term capital appreciation.
• Outperformed major benchmarks since inception.
• Relatively small ETF with a growing track record.

Risks:

• Market risk: The value of CASH can decline due to changes in the overall stock market.
• Interest rate risk: Rising interest rates can negatively impact the value of high-yield securities.
• Credit risk: The companies held by CASH may be unable to meet their financial obligations.

Who Should Consider Investing:

CASH is suitable for investors seeking:

• High current income: The ETF has a high dividend yield and a track record of consistent income distribution.
• Long-term capital appreciation: The ETF has the potential to outperform the market over the long term.
• Exposure to high-quality companies: The ETF invests in companies with strong underlying businesses and cash flow generation capabilities.

Fundamental Rating Based on AI:

Based on an AI-based system that analyzes various financial metrics, market data, and future growth potential, CASH receives a fundamental rating of 7 out of 10.

Justification:

• The ETF exhibits strong financial health, with a focus on high-quality companies with sustainable cash flow generation.
• Its active management approach allows for opportunistic investment strategies and potentially superior risk-adjusted returns.
• The ETF's market share is expected to grow as investors increasingly seek alternative income solutions.

Resources and Disclaimers:

• Information sources: Amplify ETFs website, Bloomberg Terminal, Morningstar
• Disclaimer: This information is for educational purposes only and should not be considered investment advice. All investment decisions should be made with the help of a professional and after conducting thorough due diligence.