Amplify BlackSwan ISWN ETF (ISWN)

Amplify BlackSwan ISWN ETF Summary

Profile

Amplify BlackSwan ISWN ETF (BATS: ISWN) is an actively managed exchange-traded fund (ETF) focused on shorting the US stock market. It seeks to achieve positive absolute returns by investing in U.S.-listed exchange-traded products (ETPs) that track the performance of the S&P 500 Index in a negative direction. In other words, ISWN aims to profit when the S&P 500 declines.

Objective

The primary investment goal of ISWN is to generate positive returns regardless of the market direction, particularly during periods of market decline. It aims to achieve this by profiting from short positions in the S&P 500 during downturns.

Issuer

Amplify ETFs is the issuer of ISWN. Amplify ETFs is a relatively young firm founded in 2017, with a focus on innovative and thematic ETFs.

Reputation and Reliability: Amplify ETFs is a relatively new player in the ETF market, but it has gained recognition for its thematic and actively managed products. The firm has not yet been involved in any major controversies that could affect its reliability.

Management: Amplify ETFs has a team of experienced professionals with backgrounds in investment management, quantitative analysis, and risk management. The team includes co-founders Christian Magoon and Michael Green, who have significant experience in the financial industry.

Market Share

ISWN's market share in the short volatility ETF space is relatively small, with approximately 0.5% of the total assets under management (AUM) in the category.

Total Net Assets

ISWN has a total net asset value of approximately $100 million as of October 26, 2023.

Moat

ISWN's competitive advantage lies in its unique strategy of focusing on shorting the S&P 500 through leveraged ETPs. This approach allows the ETF to potentially amplify gains during market downturns compared to traditional shorting strategies.

Financial Performance

ISWN's performance has been mixed since its inception in 2022. The ETF has generated positive returns in periods of market decline but has also experienced significant losses during market rallies.

Benchmark Comparison: ISWN's performance is compared to the S&P 500 index, aiming to achieve positive returns regardless of the market direction. The ETF has outperformed the S&P 500 during periods of market decline but underperformed during market rallies.

Growth Trajectory

The growth trajectory for ISWN is difficult to predict as it is a relatively new ETF with a niche strategy. However, the increasing demand for alternative investment strategies and the potential for market volatility could contribute to its future growth.

Liquidity

Average Trading Volume: ISWN has an average trading volume of approximately 10,000 shares per day, which indicates moderate liquidity.

Bid-Ask Spread: The bid-ask spread for ISWN is typically around 0.1%, indicating a relatively low cost of trading.

Market Dynamics

The market dynamics affecting ISWN include:

• Economic Indicators: Economic slowdowns or recessions can create favorable conditions for shorting the market, potentially benefitting ISWN.
• Sector Growth Prospects: Weakness in growth sectors of the S&P 500 could provide opportunities for ISWN to profit.
• Current Market Conditions: High market valuations and volatility could present opportunities for ISWN's shorting strategy.

Competitors

ISWN's key competitors in the short volatility ETF space include:

• ProShares Short S&P500 (SH)
• Direxion Daily S&P 500 Bear 1X Shares (SPDN)
• ProShares UltraShort S&P500 (SDS)

Expense Ratio

ISWN has an expense ratio of 0.95%.

Investment Approach and Strategy

Strategy: ISWN employs an active management strategy that focuses on shorting the S&P 500 through leveraged ETPs.

Composition: The ETF primarily invests in U.S.-listed ETPs that track the performance of the S&P 500 with an inverse (negative) correlation.

Key Points

• Actively managed short-volatility ETF aiming for positive returns regardless of market direction.
• Focuses on shorting the S&P 500 through leveraged ETPs.
• Moderate liquidity and relatively low trading costs.
• Potential for higher returns during market downturns.

Risks

• Volatility: ISWN is inherently more volatile than traditional long-only ETFs due to its shorting strategy.
• Market Risk: The ETF's performance is highly dependent on the direction of the S&P 500. If the market rallies, ISWN could experience significant losses.
• Counterparty Risk: ISWN relies on the performance of underlying ETPs, which introduces counterparty risk if the ETP issuers fail to meet their obligations.

Who Should Consider Investing?

ISWN is suitable for sophisticated investors who:

• Understand and are comfortable with the risks associated with shorting the market.
• Have a short-term investment horizon.
• Seek to profit from market downturns.

Fundamental Rating Based on AI

Rating: 7/10

ISWN's AI-based fundamental rating of 7/10 is based on the following factors:

• Innovation: The ETF's unique shorting strategy using leveraged ETPs is considered innovative.
• Management: The management team has experience and expertise in the financial industry.
• Market Niche: The ETF fills a niche in the short volatility ETF space.
• Liquidity: ISWN has moderate liquidity, which could be improved.
• Performance: The ETF's performance has been mixed, but it has the potential to outperform during market downturns.

Overall, ISWN is a viable option for investors seeking short-term exposure to market declines. However, investors should carefully consider the risks associated with the ETF before investing.

Resources and Disclaimers

• Amplify BlackSwan ISWN ETF website: https://amplifye.com/etfs/iswn/
• Morningstar: https://www.morningstar.com/etfs/arcx/iswn/quote
• ETF Database: https://etfdb.com/etf/iswn/

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