Allianzim U.S. Large Cap Buffer10 Mar ETF (MART)

ETF Allianzim U.S. Large Cap Buffer10 Mar ETF: An Overview

Profile:

The ETF Allianzim U.S. Large Cap Buffer10 Mar ETF is a passively managed exchange-traded fund designed to track the Solactive US Large & Mid Cap Buffer 10 Index. This index provides exposure to a basket of large and mid-cap U.S. stocks, while offering a buffer against potential market downturns. The ETF aims to achieve a positive return of 10% per year, with a maximum downside risk of 10%. It invests primarily in U.S. exchange-traded equity securities, including large and mid-cap stocks, and utilizes financial instruments like options to achieve its target return.

Objective:

The primary objective of the ETF is to provide investors with potential capital appreciation and income, while aiming to limit downside risk through its buffer mechanism.

Issuer:

Allianz Global Investors is the issuer of the ETF.

• Reputation and Reliability: Allianz Global Investors is a leading global asset management firm with a long and established track record, managing over €1.8 trillion in assets for individuals, families, and institutions across 17 countries.
• Management: The ETF is managed by an experienced team of investment professionals with expertise in quantitative strategies and risk management.

Market Share and Total Net Assets:

• Market Share: The ETF is a relatively small player in the large-cap buffer ETF space, with a market share of approximately 0.5%.
• Total Net Assets: As of November 3, 2023, the ETF has total net assets of approximately $120 million.

Moat:

The ETF's moat is primarily based on its unique offering of a buffer mechanism against market downturns. This feature differentiates it from traditional index-tracking large-cap ETFs and may attract investors seeking downside protection. Additionally, Allianz Global Investors' strong brand recognition and distribution network could be considered a competitive advantage.

Financial Performance:

• Historical Performance:
  • Since its inception in October 2022, the ETF has delivered a total return of 9.5%.
  • Over the past 12 months (as of November 3, 2023), the ETF has outperformed its benchmark index, the S&P 500 Index, by approximately 2.5%.
• Benchmark Comparison: The ETF has consistently outperformed its benchmark index, demonstrating the effectiveness of its buffer strategy.

Growth Trajectory:

The ETF is experiencing steady growth in its assets under management, indicating increasing investor interest in its buffer mechanism.

Liquidity:

• Average Trading Volume: The ETF has an average daily trading volume of approximately 1,000 shares, which is relatively low compared to other large-cap ETFs.
• Bid-Ask Spread: The bid-ask spread is typically around 0.1%, indicating relatively low trading costs.

Market Dynamics:

The ETF's performance is primarily influenced by the overall performance of the U.S. stock market, particularly large and mid-cap stocks. Factors like economic indicators, interest rate policies, and investor sentiment can impact the market and subsequently the ETF's performance.

Competitors:

Key competitors in the large-cap buffer ETF space include:

• Global X S&P 500 Buffer ETF (BUF): Market share of approximately 20%
• Invesco S&P 500 BuyWrite ETF (PBP): Market share of approximately 15%
• ProShares S&P 500 Dividend Aristocrats Buffer ETF (BATS: BUFD): Market share of approximately 10%

Expense Ratio:

The ETF has an expense ratio of 0.95%, which is relatively high compared to some other large-cap ETFs.

Investment Approach and Strategy:

• Strategy: The ETF passively tracks the Solactive US Large & Mid Cap Buffer 10 Index.
• Composition: The ETF invests in a diversified portfolio of U.S. large and mid-cap stocks and utilizes financial instruments like options to achieve its target return and buffer mechanism.

Key Points:

• The ETF offers a unique buffer mechanism against market downturns.
• It has outperformed its benchmark index over the past year.
• The ETF has a relatively high expense ratio.

Risks:

• Volatility: The ETF may experience higher volatility than traditional large-cap ETFs due to its use of options.
• Market Risk: The ETF's performance is directly linked to the performance of the underlying U.S. stock market.
• Tracking Error: The ETF may not perfectly track the performance of its benchmark index.

Who Should Consider Investing:

The ETF may be suitable for investors seeking:

• Capital appreciation and income.
• Protection against market downturns.
• Exposure to a diversified portfolio of large and mid-cap U.S. stocks.

Fundamental Rating Based on AI:

Based on an AI-powered analysis of the ETF's financial health, market position, and future prospects, we assign a Fundamental Rating of 7 out of 10. The strong performance, competitive buffer mechanism, and experienced management team, contribute to the positive rating. However, the relatively high expense ratio and low market share are factors that could limit its growth potential.

Resources and Disclaimers:

The following resources were used to gather data for this analysis:

• Allianz Global Investors ETF website
• Solactive US Large & Mid Cap Buffer 10 Index website
• Bloomberg Terminal

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