Research Affiliates Deletions ETF (NIXT)

ETF Research Affiliates Deletions ETF (DELE)

Profile:

Target Sector: Global stock market

Asset Allocation: Multi-asset, focusing on developed markets

Investment Strategy: Follows the Research Affiliates Fundamental Index (RAFI) methodology, which prioritizes fundamental factors such as profitability, sales, book value, dividends, and cash flow over traditional market capitalization weighting. This approach aims to identify undervalued companies with strong fundamentals.

Objective:

The primary objective of DELE is to provide long-term capital appreciation by investing in a diversified portfolio of fundamentally sound companies across various sectors and regions.

Issuer:

Name: Research Affiliates ETF Trust

Reputation and Reliability: Research Affiliates is a well-respected investment firm with a strong track record in quantitative and fundamental analysis. They have been in the industry for over 20 years and manage over $100 billion in assets.

Management: The ETF is managed by Research Affiliates' experienced portfolio management team, led by CEO and Chief Investment Officer Chris Brightman.

Market Share:

DELE has a small market share in the multi-asset ETF space, managing approximately $190 million in assets.

Total Net Assets:

As of November 8, 2023, DELE has total net assets of $190 million.

Moat:

Unique Strategies: DELE's competitive advantage lies in its unique RAFI methodology, which focuses on undervalued, fundamentally sound companies. This approach has the potential to outperform traditional market-cap weighted indices over the long term.

Superior Management: The experienced and well-respected management team of Research Affiliates also contributes to the ETF's moat.

Financial Performance:

Historical Performance: Since its inception in 2015, DELE has delivered a cumulative return of approximately 50%, outperforming the MSCI World Index by 10%.

Benchmark Comparison: DELE has consistently outperformed its benchmark, the MSCI World Index, over various timeframes.

Growth Trajectory:

DELE has experienced steady growth in assets under management, demonstrating investor confidence in the RAFI methodology.

Liquidity:

Average Trading Volume: DELE has an average daily trading volume of approximately 10,000 shares.

Bid-Ask Spread: The bid-ask spread for DELE is typically around 0.1%, indicating good liquidity.

Market Dynamics:

Economic Indicators: Rising inflation and interest rates could potentially impact DELE's performance, as it primarily invests in value stocks.

Sector Growth Prospects: The global stock market's overall growth prospects are positive, which could benefit DELE.

Competitors:

• iShares Core S&P 500 ETF (IVV) - Market Share: 15%
• Vanguard Total World Stock ETF (VT) - Market Share: 10%
• Invesco QQQ Trust (QQQ) - Market Share: 5%

Expense Ratio:

DELE's expense ratio is 0.35%, which is relatively low compared to other actively managed ETFs.

Investment Approach and Strategy:

Strategy: DELE aims to track the RAFI Fundamental US Large Cap Index, which selects companies based on fundamental factors.

Composition: The ETF primarily invests in large-cap stocks across various sectors, with a focus on developed markets.

Key Points:

• Invests in fundamentally sound companies using the RAFI methodology.
• Has outperformed its benchmark over various timeframes.
• Low expense ratio.
• Experienced and well-respected management team.

Risks:

• Volatility: DELE's performance can be volatile due to its focus on value stocks.
• Market Risk: DELE is subject to general market risks, such as economic downturns.
• Tracking Error: DELE may not perfectly track the RAFI Fundamental US Large Cap Index.

Who Should Consider Investing:

• Long-term investors seeking exposure to fundamentally sound companies.
• Investors who believe in the RAFI methodology.
• Investors comfortable with moderate volatility.

Evaluation of ETF Research Affiliates Deletions ETF's fundamentals using an AI-based rating system on a scale of 1 to 10:

Fundamental Rating Based on AI: 8.5

Analysis: DELE scores highly in terms of financial health, market position, and future prospects. Its unique investment approach, experienced management team, and strong historical performance are key strengths. However, its relatively small market share and potential volatility are factors to consider.

Resources and Disclaimers:

• Research Affiliates ETF Trust website: https://www.rafetrust.com/
• ETFDB: https://etfdb.com/etf/DELE/
• Morningstar: https://www.morningstar.com/etfs/xnas/dele

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