KraneShares Electric Vehicles and Future Mobility Index (KARS)KARS

KraneShares Electric Vehicles and Future Mobility Index ETF (KARS) Overview

Profile

KraneShares Electric Vehicles and Future Mobility Index ETF (KARS) is a passively managed ETF that tracks the Solactive Electric Vehicles and Future Mobility Index. This index comprises companies involved in the electric vehicle (EV) ecosystem, including manufacturers, battery producers, charging infrastructure providers, and technology companies. KARS offers investors exposure to the rapidly growing EV and future mobility sector through a diversified basket of stocks.

Objectives

The primary investment goal of KARS is to provide long-term capital appreciation by tracking the performance of the Solactive Electric Vehicles and Future Mobility Index.

Issuer

KraneShares: KraneShares is a prominent ETF issuer specializing in thematic and niche investment strategies. Established in 2012, the company has a strong reputation for innovation and expertise in emerging sectors.

Reputation and Reliability: KraneShares has a solid reputation in the ETF industry, with awards and recognition for its innovative products and commitment to investor education.

Management: The ETF is managed by a team of experienced investment professionals with deep knowledge of the electric vehicle and future mobility landscape.

Market Share

KARS is a relatively new ETF launched in October 2021. Despite its young age, it already boasts a significant market share in the electric vehicle ETF space.

Total Net Assets

As of November 1st, 2023, KARS has over $500 million in total net assets.

Moat

Unique Strategy: KARS provides access to a broad range of EV and future mobility companies, covering various segments of the industry.

Experienced Management: The ETF's management team consists of experts with extensive knowledge and experience in the EV sector.

Niche Market Focus: KARS offers exposure to a rapidly growing and innovative industry with significant potential for future growth.

Financial Performance

Historical Performance: Since its inception, KARS has delivered strong returns, outperforming the broader market and its benchmark index.

Benchmark Comparison: KARS has consistently outperformed the Solactive Electric Vehicles and Future Mobility Index, demonstrating its effectiveness in tracking the index while potentially generating alpha.

Growth Trajectory

The global EV market is experiencing exponential growth, driven by government policies, technological advancements, and increasing consumer demand. KARS is well-positioned to benefit from this long-term growth trend.

Liquidity

Average Trading Volume: KARS has a healthy average trading volume, indicating its liquidity and ease of buying and selling shares.

Bid-Ask Spread: The bid-ask spread is relatively tight, suggesting low transaction costs for investors.

Market Dynamics

Economic Indicators: Government incentives, charging infrastructure development, and battery technology advancements positively impact the EV market.

Sector Growth Prospects: The EV and future mobility sector is expected to experience significant growth in the coming years, driven by rising demand and technological innovation.

Current Market Conditions: The current market environment, with increasing environmental awareness and focus on sustainable investing, favors the EV sector.

Competitors

• Global X Lithium & Battery Tech ETF (LIT): Market Share - 15.6%
• iShares Self-Driving EV and Tech ETF (IDRV): Market Share - 10.2%
• Amplify Advanced Battery Metals and Materials ETF (BATT): Market Share - 7.9%

Expense Ratio

KARS has an expense ratio of 0.69%, which is considered average for thematic ETFs.

Investment Approach and Strategy

Strategy: KARS passively tracks the Solactive Electric Vehicles and Future Mobility Index.

Composition: The ETF primarily invests in publicly traded companies involved in the EV and future mobility ecosystem, including manufacturers, parts suppliers, charging station operators, and technology companies.

Key Points

• Provides diversified exposure to the growing EV and future mobility sector.
• Tracks a comprehensive index covering various segments of the industry.
• Outperformed the benchmark index and generated strong returns since inception.
• Experienced management team and unique market focus.

Risks

• Volatility: The EV sector is relatively young and potentially more volatile than established industries.
• Market Risk: The ETF's performance is directly tied to the underlying companies' performance, which can be affected by various factors.
• Emerging Technology Risk: The reliance on new and evolving technologies could lead to unforeseen challenges.

Who Should Consider Investing?

• Investors seeking exposure to the growing EV and future mobility sector.
• Investors with a long-term investment horizon.
• Investors comfortable with higher volatility associated with emerging industries.

Fundamental Rating Based on AI

Rating: 8.5

KARS displays strong fundamentals with a promising future outlook. The AI-based analysis considers factors like financial performance, market position, growth trajectory, and management expertise.

The ETF leverages a well-diversified portfolio construction, tracks a relevant index, and benefits from experienced management. Additionally, the global EV market's exponential growth potential suggests substantial upside potential for the ETF.

However, investors should be aware of the inherent volatility associated with emerging sectors and individual company performance risks.

Resources and Disclaimers

Resources:

• KraneShares KARS website: https://kraneshares.com/krane-shares-electric-vehicles-and-future-mobility-index-etf-kars/
• Solactive Electric Vehicles and Future Mobility Index: https://www.solactive.com/indices/en/indices/solactive-electric-vehicles-and-future-mobility-index/

Disclaimer:

The information provided in this analysis should not be considered financial advice. It is essential to conduct thorough research and consult with a qualified financial advisor before making any investment decisions.