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ETF BlueStar Israel Technology ETF: A Comprehensive Overview

Profile

ETF BlueStar Israel Technology ETF (BIST) is a passively managed exchange-traded fund that tracks the BlueStar Israel Global Technology Index. This index is comprised of leading Israeli technology companies traded on stock exchanges worldwide. BIST offers investors exposure to the dynamic and innovative Israeli technology sector.

Objective

The primary investment goal of BIST is to provide long-term capital appreciation by replicating the performance of the BlueStar Israel Global Technology Index.

Issuer

BlueStar Indexes Ltd.

• Reputation and Reliability: BlueStar Indexes is a leading provider of Israeli indices and data solutions. They have been operating since 1997 and have a strong reputation for accuracy and reliability.
• Management: The BlueStar team has extensive experience in the Israeli financial markets and a deep understanding of the technology sector.

Market Share

BIST holds a significant market share within its niche, being one of the few ETFs dedicated solely to Israeli technology stocks.

Total Net Assets

As of October 26, 2023, BIST has approximately $150 million in total net assets.

Moat

• Unique Focus: BIST provides targeted exposure to the high-growth Israeli technology sector, which is often overlooked by broader emerging market funds.
• Underlying Index: The BlueStar Israel Global Technology Index is a well-established and respected benchmark, ensuring diversification across leading Israeli technology companies.
• Experienced Management: BlueStar's team has a proven track record in managing Israeli indices and selecting high-performing technology companies.

Financial Performance

BIST has delivered strong historical returns, outperforming the broader Israeli market and technology indices. However, it's important to remember that past performance is not indicative of future results.

Benchmark Comparison:

• BIST vs. TA-35 Index: BIST has outperformed the TA-35 Index, the benchmark for the Israeli stock market, over the past 3 and 5 years.
• BIST vs. NASDAQ-100 Index: BIST has also outperformed the NASDAQ-100 Index, a benchmark for the global technology sector, over the same periods.

Growth Trajectory

The Israeli technology sector is expected to continue experiencing strong growth driven by factors such as innovation, talent pool, and government support. This bodes well for BIST's future prospects.

Liquidity

• Average Trading Volume: BIST has a healthy average trading volume, ensuring easy entry and exit for investors.
• Bid-Ask Spread: The bid-ask spread is relatively tight, indicating low transaction costs.

Market Dynamics

• Positive factors: Strong economic growth in Israel, increasing global demand for technology solutions, and government support for the technology sector.
• Negative factors: Rising interest rates, geopolitical risks in the region, and potential slowdown in global technology spending.

Competitors

• iShares MSCI Israel ETF (ISRA): Holds a broader range of Israeli stocks, including technology companies.
• VanEck Merkaba Israel Innovation ETF (ISRA): Invests in Israeli companies with high growth potential, including technology firms.

Expense Ratio

BIST has an expense ratio of 0.75%, which is competitive within its category.

Investment Approach and Strategy

• Strategy: BIST passively tracks the BlueStar Israel Global Technology Index.
• Composition: The ETF primarily holds stocks of leading Israeli technology companies across various sub-sectors.

Key Points

• Targeted exposure to high-growth Israeli technology sector.
• Strong historical performance and outperformance of benchmarks.
• Experienced management team and well-established underlying index.
• Competitive expense ratio and healthy liquidity.

Risks

• Volatility: The Israeli technology sector is known for its volatility, which can impact the ETF's performance.
• Market Risk: The ETF's performance is directly tied to the performance of the underlying Israeli technology companies.
• Currency Risk: BIST is exposed to fluctuations in the US dollar and Israeli shekel exchange rate.

Who Should Consider Investing?

BIST is suitable for investors seeking:

• Exposure to the high-growth Israeli technology sector.
• Diversification beyond traditional technology indices.
• Long-term capital appreciation potential.
• Tolerance for volatility and market risk.

Fundamental Rating Based on AI: 8.5/10

BIST receives a strong rating based on its unique focus, experienced management, strong historical performance, and attractive growth prospects. However, investors should be mindful of the associated risks and ensure BIST aligns with their individual investment goals and risk tolerance.

Resources and Disclaimers

• BlueStar Indexes Ltd. website: https://www.bluestarindexes.com/
• ETF BlueStar Israel Technology ETF Fact Sheet: https://www.ishares.com/us/products/etf-product-detail?ticker=BIST
• Morningstar Report for BIST: https://www.morningstar.com/etfs/arcx/bist/quote

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