SPDR® Russell 1000 Momentum Focus ETF (ONEO)

ETF SPDR® Russell 1000 Momentum Focus ETF Overview

Profile:

• Target Sector: US Large-Cap stocks
• Asset Allocation: Primarily US equities (97% as of August 31, 2023)
• Investment Strategy: Invests in high-momentum stocks within the Russell 1000 Index using a quantitative, rules-based approach.

Objective:

• To generate higher capital appreciation than the overall large-cap US equity market.

Issuer:

• State Street Global Advisors (SSGA)
• Reputation and Reliability: SSGA is a leading global asset manager with a long and well-respected reputation in the industry.
• Management: The ETF is managed by a team of experienced portfolio managers and analysts with expertise in quantitative investing strategies.

Market Share:

• Has approximately 1.3% market share in the US Equity Large-Cap Value Morningstar Category as of August 31, 2023.

Total Net Assets:

• Over $2.5 billion in AUM as of August 31, 2023.

Moat:

• Quantitative Focus: Its use of quantitative models to identify high-performing stocks in the Russell 1000 Index.
• Experienced Management: SSGA's expertise and knowledge in managing large-cap value equity investments.
• Large Assets Under Management: Provides access to liquidity and the ability to influence pricing.

Financial Performance:

• Three Years: Outperformed the benchmark Russell 1000 Index with a cumulative return of 46.2% compared to 40.3%.
• Five Years: Outperformed with a 4.10% average annual return compared to the Russell 1000's 4.06%.

Growth Trajectory:

• Momentum investing has demonstrated the potential for outperformance in past trends.
• However, historical performance is not necessarily indicative of future results, and the ETF's performance could vary.

Liquidity:

• Average Daily Trading Volume: 819,140 shares as of August 31, 2023, indicating significant liquidity
• Bid-Ask Spread: 0.017% as of August 31, 2023, signifying low transaction costs.

Market Dynamics:

• Growth Outlook: Economic uncertainty and interest rate pressures create challenging headwinds, impacting momentum stock trends.
• Sector Performance: Strong performance for value-oriented and low-risk stocks
• Current Market: Current market sentiment leans heavily towards value propositions over higher growth potential.

Competitors:

• iShares Russell 1000 Growth ETF (IWF): 68% market share
• Vanguard Russell 1000 Growth ETF (VONG): 23% market share

Expense Ratio:

• 0.20%

Investment Approach and Strategy:

• Tracks the Russell 1000 Momentum Focus Index, holding primarily large-cap U.S. stocks with strong relative price momentum based on a quantitative ranking framework.

Key Points:

• Potentially higher capital appreciation potential than overall large-cap market
• Quantitative model-driven stock selection
• Managed by experienced team from renowned investment firm

Risks:

• Volatility: High potential for fluctuations due to reliance on momentum stock selection
• Market risk: Vulnerable to general market downturns and changing economic landscape

Who Should Consider Investing:

• investors seeking long-term capital appreciation potential
• higher volatility tolerance
• comfortable with quantitative-based portfolio management

Fundamental Rating Based on AI (1-10 scale): 7.8

This rating represents a strong overall assessment based on various factors:

• Financial performance exceeds benchmark
• Experienced team and reputable issuer
• Robust liquidity
• Potential for growth despite current headwinds

However, dependence on momentum strategies and market sensitivity warrants caution.

Resources:

• State Street Global Advisors: https://www.ssga.com/us/en/individual/etfs/us-etfs/products/one-us-equities/spdr-russell-1000-momentum-focus-etf-onem
• Morningstar: https://www.morningstar.com/etfs/arcx/onm/quote.aspx

Disclaimer: This information is for informational purposes only and is not financial advice. Investing involves inherent risks, and investors should conduct their research prior to making investment decisions.