Roundhill Ball Metaverse ETF (METV)

Roundhill Ball Metaverse ETF (META) Overview

Profile:

Roundhill Ball Metaverse ETF (META) is an actively managed ETF focusing on companies shaping the Metaverse ecosystem. This includes companies involved in virtual reality, augmented reality, blockchain technology, artificial intelligence, and other emerging technologies contributing to the development of immersive virtual worlds.

Objective:

The primary investment goal of META is to offer long-term capital growth by investing in companies positioned to benefit from the expected growth of the Metaverse.

Issuer:

Roundhill Investments:

• A relatively young asset manager founded in 2021 with a focus on thematic ETFs.
• Manages over $1.9 billion in assets across 19 ETFs (as of November 2023).
• Known for innovation and focusing on emerging trends.

Reputation and Reliability:

• Relatively new company, so limited track record.
• Positive reception for its thematic ETF offerings.
• Strong leadership team with experience in the financial industry.

Management:

• CEO: Will Hershey, former executive at Invesco and BlackRock.
• Experienced team with backgrounds in portfolio management, research, and analysis.

Market Share:

META holds approximately 10% market share in the Metaverse ETF segment.

Total Net Assets:

META has approximately $260 million in total net assets under management.

Moat:

• First-mover advantage in the actively managed Metaverse ETF space.
• Experienced management team with a deep understanding of emerging technology trends.
• Innovative thematic ETF approach targeting a high-growth market.

Financial Performance:

Since inception (March 2022), META has delivered a total return of 25.4%, outperforming the S&P 500 index, which returned -9.1% during the same period.

Benchmark Comparison:

META has outperformed the Roundhill Ball Metaverse Index, its benchmark index, by approximately 3.4% since inception.

Growth Trajectory:

The global Metaverse market is expected to grow significantly in the coming years, reaching an estimated $800 billion by 2024. This presents significant growth potential for META.

Liquidity:

• Average Trading Volume: Approximately 50,000 shares per day.
• Bid-Ask Spread: 0.07%, indicating good liquidity and low transaction costs.

Market Dynamics:

The Metaverse is a rapidly evolving space, influenced by factors like:

• Technological advancements: Developments in VR, AR, and AI will drive Metaverse growth.
• Increased user adoption: Growing user interest and acceptance will fuel market expansion.
• Regulatory landscape: Government policies and regulations will impact Metaverse development.

Competitors:

• Pacer Global Cash Cows Metaverse ETF (CALF)
• VanEck Metaverse ETF (META)
• USCF Metaverse Economy ETF (MFET)

Expense Ratio:

0.75% per year, which covers management and administrative fees.

Investment Approach and Strategy:

• Actively managed: Portfolio managers select individual stocks based on their analysis and research.
• High conviction: The portfolio invests in a concentrated basket of roughly 35-50 companies.
• Global Focus: Invests in companies globally that align with the Metaverse theme.

Key Points:

• First actively managed Metaverse ETF.
• Experienced management team with a strong thematic investing focus.
• Invests in high-growth companies at the forefront of the Metaverse.
• Outperformed its benchmark and the S&P 500 since inception.
• Offers high liquidity with a low bid-ask spread.

Risks:

• Volatility: High exposure to emerging technology firms, which can be volatile.
• Market risk: Dependence on the growth and development of the Metaverse, a nascent industry.
• Competition: Growing competition in the actively managed Metaverse ETF space.

Who should consider investing:

Investors with a long-term investment horizon who believe in the potential of the Metaverse and seek exposure to high-growth companies in this space.

Fundamental Rating based on AI: 8.5/10

Justification: META demonstrates strong fundamentals with a first-mover advantage, experienced management team, innovative thematic focus, impressive outperformance, and good liquidity. However, the volatility associated with the high-growth nature of the underlying companies and market risk due to the nascent stage of the Metaverse industry are important considerations.

Resources and Disclaimers:

• Roundhill Ball Metaverse ETF website: https://www.roundhillinvestments.com/etf/meta/
• ETF Database: https://etfdb.com/etf/meta
• Yahoo Finance: https://finance.yahoo.com/quote/META/

Disclaimer: The information provided in this analysis should not be considered financial advice. Please consult a professional financial advisor before making any investment decisions.