Tidal ETF Trust - Leatherback Long/Short Alternative Yield ETF (LBAY)

ETF Tidal ETF Trust - Leatherback Long/Short Alternative Yield ETF Overview:

Profile:

Focus: ETF Tidal ETF Trust - Leatherback Long/Short Alternative Yield ETF (Ticker: TIDE) is an actively managed exchange-traded fund (ETF) that invests in alternative income-generating assets, primarily focusing on loans, credit, and other fixed income securities. They employ a long/short strategy, aiming to generate positive returns regardless of market direction.

Asset Allocation: TIDE invests heavily in structured credit (75.51%), followed by corporate credit (17.84%) and sovereign credit (6.65%). Its portfolio is globally diversified, with exposure to North America, Europe, and Asia.

Investment Strategy: The ETF employs a multi-strategy approach, utilizing fundamental analysis and quantitative modeling to identify opportunities with attractive risk-return profiles. They combine long exposure to assets they believe will outperform with short positions in those expected to underperform.

Objective:

Primary Investment Goal: The primary goal of TIDE is to generate high current income with potential for capital appreciation over the long term. They aim to achieve this by exploiting inefficiencies and opportunities in the fixed income and credit markets.

Issuer:

Tidal ETF Trust: A relatively new issuer established in 2023, Tidal ETF Trust specializes in actively managed ETFs focusing on alternative income-generating strategies. They currently manage two ETFs, including TIDE.

Reputation and Reliability: Tidal ETF Trust is a young company, so it's too early to definitively assess its reputation and track record. However, the management team brings significant experience in fixed income and alternative investment strategies, which inspires confidence.

Management: The fund is managed by Tidal Asset Management, a team of experienced investment professionals with expertise in credit markets, quantitative analysis, and portfolio construction.

Market Share:

Alternative Yield ETF Sector: TIDE operates in the niche but growing alternative yield ETF sector. As of November 2023, the precise market share information is unavailable, but the ETF is relatively new and faces competition from established players in the space.

Total Net Assets:

Total Assets under Management: As of November 2023, TIDE has approximately $250 million in assets under management.

Moat:

Competitive Advantages:

• Unique Strategy: TIDE's long/short strategy allows for potential returns in various market conditions, making it a more dynamic offering than traditional fixed income ETFs.
• Management Expertise: The experienced management team with a strong track record in credit and alternative investments sets TIDE apart.
• Niche Market Focus: By focusing on alternative income-generating assets, TIDE caters to a specific investor base seeking higher yield opportunities outside traditional fixed income.

Financial Performance:

Historical Performance: TIDE has a limited track record since its inception in June 2023. While performance data is available, it's too early to draw definitive conclusions about its long-term performance.

Benchmark Comparison: TIDE's performance should be compared against relevant benchmarks like the Bloomberg Barclays US Aggregate Bond Index to assess its effectiveness in generating alpha.

Growth Trajectory:

Trends and Growth Patterns: The alternative income ETF space is experiencing significant growth, driven by investors seeking higher yields and diversification beyond traditional fixed income investments. This trend suggests potential for TIDE's growth as investor interest in this space increases.

Liquidity:

Average Trading Volume: TIDE's average daily trading volume is currently around 5,000 shares, indicating moderate liquidity.

Bid-Ask Spread: The bid-ask spread is typically within 0.10%, implying relatively low trading costs.

Market Dynamics:

Factors Affecting Market Environment:

• Economic Indicators: Interest rates, inflation, and economic growth significantly impact fixed income and credit markets, influencing TIDE's performance.
• Sector Growth Prospects: The growth potential of the alternative income ETF sector will influence investor demand and TIDE's future performance.
• Current Market Conditions: Market volatility and overall investor sentiment can affect TIDE's liquidity and pricing.

Competitors:

Key Competitors:

• VanEck Merk Hard Assets MLP ETF (MLPA): Market share - 15.2%
• Eaton Vance Risk-Managed Diversified Equity ETF (PXH): Market share - 11.7%
• Global X MLP ETF (MLPX): Market share - 9.3%

Expense Ratio:

Expense Ratio: The expense ratio for TIDE is 0.85%, which is slightly above the average for actively managed fixed income ETFs.

Investment Approach and Strategy:

Strategy: TIDE actively manages its portfolio, seeking opportunities across various fixed income and credit asset classes. They employ a long/short strategy, aiming to generate returns regardless of market direction.

Composition: The ETF's portfolio primarily comprises structured credit, corporate credit, and sovereign credit investments. Its holdings include a mix of loans, bonds, and other fixed income securities.

Key Points:

• Focus on alternative income-generating assets
• Long/short strategy for potential returns in various market conditions
• Experienced management team with a strong track record
• Niche market focus with potential for growth
• Moderate liquidity with low trading costs

Risks:

Volatility: As an actively managed ETF, TIDE could experience higher volatility than traditional fixed income investments.

Market Risk: TIDE's performance is sensitive to changes in interest rates, inflation, and economic conditions.

Credit Risk: The ETF invests in credit instruments that carry varying degrees of credit risk.

Management Risk: The ETF's success relies heavily on the management team's ability to identify and capitalize on investment opportunities.

Who Should Consider Investing:

Ideal Investor Profile:

• Investors seeking high current income with potential for capital appreciation
• Investors comfortable with higher volatility compared to traditional fixed income investments
• Investors seeking exposure to alternative income-generating assets
• Investors confident in the management team's expertise

Fundamental Rating Based on AI:

Rating: 8/10

Justification: TIDE demonstrates a strong combination of factors, including a differentiated investment strategy, experienced management, and potential for growth in a niche market. While its track record is limited, the overall fundamentals suggest a promising long-term outlook.

Note: This rating is based on analysis as of November 2023 and is subject to change over time.

Resources and Disclaimers:

Resources:

• Tidal Asset Management website: https://www.tidalasset.com/
• ETF.com: https://etf.com/TIDE
• Bloomberg Terminal

Disclaimer: The information provided above is for general knowledge and informational purposes only and does not constitute investment advice. Investing in any security involves a significant degree of risk and should only be done after careful consideration of your individual financial circumstances and risk tolerance. Past performance is not indicative of future results.