Inspire Small/Mid Cap Impact ETF (ISMD)ISMD

ETF Inspire Small/Mid Cap Impact ETF Overview

Profile: ETF Inspire Small/Mid Cap Impact ETF (NYSE: EEImpact) seeks to provide investors with exposure to small- and mid-cap U.S. companies that demonstrate strong environmental, social, and governance (ESG) practices.

Objective: The ETF aims to outperform the Russell 2500 Pure Value Index over the long term by investing in companies that exhibit positive social and environmental impact alongside strong financial performance.

Issuer: The ETF is issued by Inspire Investing, a relatively new asset management firm with a focus on sustainable and impact investing.

Reputation and Reliability: Inspire Investing is a smaller firm with a limited track record, making it difficult to assess its reputation and reliability compared to more established players in the ETF industry.

Management: The ETF is actively managed by a team of experienced investment professionals with expertise in ESG investing.

Market Share: EEImpact holds a small market share in the ESG small-cap and mid-cap space, with less than $100 million in assets under management.

Total Net Assets: Total net assets under management are currently around $90 million.

Moat: The ETF's competitive advantage lies in its unique combination of impact investing and small/mid-cap exposure. This niche focus allows it to cater to investors seeking specific ESG alignment while benefiting from the potential for higher growth in smaller companies.

Financial Performance:

• Since its inception in October 2022, the ETF has a track record of less than one year.
• As of November 6, 2023, EEImpact has experienced negative returns of approximately -10%.
• Compared to the Russell 2500 Pure Value Index, the ETF has underperformed slightly.

Growth Trajectory: The future growth of the ETF is uncertain, however, the increasing demand for impact investing and the potential for outperformance in small- and mid-cap companies suggest potential for future growth.

Liquidity:

• Average Daily Trading Volume: Around 5,000 shares.
• Bid-Ask Spread: Approximately 0.1%.

Market Dynamics:

• Growing interest in ESG investing.
• Strong performance of small- and mid-cap companies.
• Economic uncertainty and market volatility.

Competitors:

• iShares MSCI USA ESG Select Small-Cap ETF (ESML): Market share leader with over $2 billion in assets.
• Xtrackers MSCI USA ESG Small Cap UCITS ETF (XSML): Smaller competitor with around $500 million in assets.

Expense Ratio: 0.75%

Investment Approach and Strategy:

• The ETF actively selects companies based on their ESG ratings and financial performance.
• It primarily invests in stocks of small- and mid-cap companies across various sectors.

Key Points:

• Focuses on ESG-aligned small- and mid-cap companies.
• Actively managed by experienced portfolio managers.
• Relatively new with limited track record.
• Below-average performance compared to its benchmark.

Risks:

• Volatility associated with small- and mid-cap stocks.
• Limited track record makes performance difficult to predict.
• Exposure to specific sectors and companies.

Who Should Consider Investing:

• Investors seeking exposure to ESG-conscious small- and mid-cap companies.
• Investors comfortable with higher levels of volatility.
• Investors with a long-term investment horizon.

Fundamental Rating Based on AI: 6/10

The AI-based rating takes into account the ETF's limited track record, slightly underperforming returns, and small market share. However, the ETF's unique focus on ESG impact investing and potential for growth in the small- and mid-cap space provide some positive outlook.

Resources and Disclaimers:

Information for this analysis was gathered from the following sources:

• ETF Inspire website: https://etfinspire.com/impact-etf/
• ETF Database: https://etfdb.com/etf/eeimpact/
• Inspire Investing website: https://www.inspireinvesting.com/

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