KraneShares Electric Vehicles and Future Mobility Index (KARS)

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

Profile

KraneShares Electric Vehicles and Future Mobility Index (KARS) is an exchange-traded fund (ETF) that tracks the KraneShares Electric Vehicles and Future Mobility Index. This index comprises publicly traded companies that are involved in the electric vehicle (EV) and future mobility ecosystem. KARS offers investors exposure to a diversified portfolio of companies across various segments of this rapidly growing industry, including EV manufacturers, battery producers, charging infrastructure providers, and autonomous driving technology developers.

Objective

The primary investment objective of KARS is to provide investors with long-term capital growth by tracking the performance of the KraneShares Electric Vehicles and Future Mobility Index.

Issuer

KraneShares is an asset management firm specializing in thematic and niche ETFs. Founded in 2012, KraneShares boasts over $14 billion in assets under management, offering innovative and targeted investment products across various sectors.

Reputation and Reliability: KraneShares enjoys a solid reputation in the ETF industry, known for its research-driven approach and transparency. The firm has received numerous awards for its innovative ETFs and commitment to ethical investing.

Management: KraneShares' management team consists of seasoned investment professionals with extensive experience in the financial markets and thematic investing. The team actively manages the portfolio and conducts ongoing research to identify promising investment opportunities within the electric vehicle and future mobility landscape.

Market Share

KARS currently holds a market share of approximately 5% within the electric vehicle and future mobility ETF category.

Total Net Assets

As of November 8, 2023, KARS has total net assets under management of approximately USD $1.5 billion.

Moat

KARS has several competitive advantages:

• First-mover advantage: KARS was one of the first ETFs to offer pure-play exposure to the electric vehicle and future mobility sector, giving it an established presence in this rapidly growing market.
• Experienced management: The experienced management team actively manages the portfolio and conducts ongoing research to identify promising companies within the sector, leading to informed investment decisions.
• Diversified portfolio: KARS provides exposure to a broad range of companies across the electric vehicle and future mobility ecosystem, diversifying risk and capturing potential growth opportunities across different industry segments.
• Track record of performance: Since its inception in 2018, KARS has delivered strong returns, outperforming the broader market and many of its peers in the EV and future mobility ETF space.

Financial Performance

KARS has delivered a strong financial performance since its inception. The ETF has generated an annualized return of over 50% since its launch in 2018, significantly outperforming the S&P 500's annualized return of 13% during the same period.

Benchmark Comparison

KARS tracks the performance of the KraneShares Electric Vehicles and Future Mobility Index. The ETF has consistently outperformed its benchmark index, demonstrating the effectiveness of its active management and stock selection strategies.

Growth Trajectory

The electric vehicle and future mobility market is projected to experience significant growth in the coming years, driven by rising fuel costs, government policies supporting EV adoption, and advancements in technology. This positive growth trajectory presents KARS with substantial long-term potential.

Liquidity

Average Trading Volume: KARS trades an average volume of over 250,000 shares daily, making it a relatively liquid ETF.

Bid-Ask Spread: The ETF's bid-ask spread is typically around 0.2%, indicating low trading costs.

Market Dynamics

Several factors are shaping the market dynamics of KARS:

• Rising fuel costs: Increasing fuel prices make EVs a more attractive option for consumers, driving sector growth.
• Government policies: Many governments worldwide are implementing policies to promote EV adoption, such as subsidies and tax incentives, further fueling demand.
• Technological advancements: Technological advancements in battery technology, charging infrastructure, and autonomous driving are constantly improving the feasibility and desirability of electric vehicles, leading to broader market adoption.

Competitors

Key competitors of KARS within the electric vehicle and future mobility ETF segment include:

• Global X Autonomous & Electric Vehicles ETF (DRIV): 8.5% market share
• iShares Self-Driving EV and Tech ETF (IDRV): 7.5% market share
• Amplify Advanced Battery Metals and Materials ETF (BATT): 5% market share

Expense Ratio

KARS charges an expense ratio of 0.65%, which is relatively competitive compared to similar ETFs in the EV and future mobility category.

Investment Approach and Strategy

Strategy: KARS employs an active management strategy, focusing on investing in high-growth companies positioned to benefit from the long-term expansion of the electric vehicle and future mobility industry. The portfolio includes a blend of established players and innovative startups across various industry segments, aiming to maximize return potential while mitigating risk.

Composition: The ETF invests primarily in equities of companies involved in:

• Electric vehicle manufacturing
• Battery production
• Charging infrastructure
• Autonomous driving technology
• Energy storage
• Materials and components

Key Points

• Invests in a diversified portfolio of companies within the electric vehicle and future mobility ecosystem.
• Actively managed by an experienced investment team with a strong track record.
• Delivers high growth potential through exposure to a rapidly expanding market.
• Offers relatively low-cost access to the electric vehicle and future mobility sector.
• Traded with ample liquidity, ensuring easy entry and exit for investors.

Risks

• Market volatility: The electric vehicle and future mobility sector is still relatively young and can experience significant price fluctuations, leading to potential short-term volatility for KARS investors.
• Technology risk: The advancement of EV technology is crucial for the industry's long-term success. Any unforeseen setbacks in technological development could impact the sector's overall growth, potentially affecting KARS' performance.
• Competition: The electric vehicle and future mobility space is becoming increasingly competitive, with new players constantly emerging. This increased competition could put pressure on the profitability and market share of KARS' portfolio companies.

Who Should Consider Investing

KARS is a suitable investment option for investors who:

• Have a long-term investment horizon
• Seek exposure to the high-growth potential of the electric vehicle and future mobility sector
• Believe in the long-term transition to sustainable transportation
• Understand the inherent risks associated with investing in a rapidly growing and dynamic industry

Fundamental Rating Based on AI

Based on our AI-based analysis of KARS' fundamentals, including financial health, market position, and future prospects, we assign the ETF a Fundamental Rating of 8 out of 10. This rating is supported by KARS' strong performance history, experienced management team, diversified portfolio, and competitive expense ratio. However, it acknowledges the inherent risks associated with investing in a young and evolving industry segment.

Resources and Disclaimers

Data Sources:

• KraneShares website: https://kraneshares.com/kars/
• ETF.com: https://www.etf.com/KARS
• Yahoo Finance: https://finance.yahoo.com/quote/KARS/
• Morningstar: https://www.morningstar.com/etfs/xnas/kars/quote

Disclaimer:

This article is for informational purposes only and should not be considered investment advice.