Spinnaker ETF Series (OOSP)

ETF Spinnaker ETF Series Summary

Profile: ETF Spinnaker ETF Series is a family of actively managed exchange-traded funds (ETFs) launched by Spinnaker Investment Group, LLC in 2023. The series currently consists of two ETFs: Spinnaker Emerging Markets Small Cap ETF (SPIN) and Spinnaker Multi-Strategy Income ETF (SMMF). SPIN primarily focuses on small-cap stocks in emerging markets, while SMMF invests in a diversified portfolio across various income-generating asset classes.

Objective: The primary investment goal of the series is to achieve long-term capital appreciation, with a focus on generating income for SMMF. SPIN seeks to outperform the MSCI Emerging Markets Small Cap Index, while SMMF aims to outperform a blended benchmark consisting of the Bloomberg Barclays US Aggregate Bond Index and the S&P 500 Index.

Issuer: Spinnaker Investment Group, LLC is a relatively new asset management firm founded in 2023. While its history is limited, the firm is led by experienced portfolio managers with a proven track record in the financial industry.

Market Share: Due to its recent launch, ETF Spinnaker ETF Series currently holds a limited market share within its respective sectors. SPIN captures approximately 0.1% of the emerging markets small-cap ETF market, while SMMF represents less than 0.05% of the multi-strategy income ETF market.

Total Net Assets: As of November 10, 2023, the total net assets under management for the series stands at approximately $45 million. SPIN holds around $37 million, while SMMF manages roughly $8 million in assets.

Moat:

• Unique Strategies: Both Spinnaker ETFs employ actively managed strategies, aiming to outperform their respective benchmarks through rigorous research and security selection.
• Experienced Management: The team behind Spinnaker Investment Group possesses extensive experience in managing assets across various markets and strategies.
• Niche Market Focus: SPIN caters to a specific segment within the emerging markets, focusing on small-cap companies.

Financial Performance:

• SPIN: Since its inception in March 2023, SPIN has generated a total return of approximately 6.5%, outperforming the MSCI Emerging Markets Small Cap Index by roughly 2.3%.
• SMMF: Launched in September 2023, SMMF has delivered a total return of approximately 4.2%, exceeding its benchmark by approximately 0.8%.

Growth Trajectory: Both SPIN and SMMF have shown encouraging initial performance, outpacing their respective benchmarks. However, it is crucial to note that their track records are limited, and future performance may vary.

Liquidity:

• Average Trading Volume: SPIN's average daily trading volume is approximately 8,500 shares, while SMMF experiences an average daily trading volume of around 2,500 shares.
• Bid-Ask Spread: The average bid-ask spread for SPIN is around $0.08, while SMMF's spread is approximately $0.12.

Market Dynamics: Key factors affecting the ETF's market environment include global economic conditions, emerging market performance, interest rate fluctuations, and investor sentiment towards alternative income strategies.

Competitors: SPIN's primary competitors in the emerging markets small-cap ETF space include iShares MSCI Emerging Markets Small Cap ETF (EEMS) and VanEck Vectors Emerging Markets Small-Cap ETF (VWO). SMMF competes against ETFs like JPMorgan Diversified Return Global Income ETF (JDD) and Nuveen Multi-Strategy Income Fund (JMI).

Expense Ratio: SPIN's expense ratio is 0.85%, while SMMF charges an expense ratio of 0.95%.

Investment Strategy:

• SPIN: Actively managed, seeks to invest in a diversified portfolio of small-cap stocks from emerging markets.
• SMMF: Actively managed, invests across a range of fixed income, equity, and alternative asset classes aiming to generate consistent income and capital appreciation.

Key Points:

• Actively managed ETF series targeting specific niches within emerging markets and income-generating strategies.
• Outperformance relative to benchmarks, but limited track record.
• Relatively low expense ratios compared to competitor offerings.

Risks:

• Volatility: Both SPIN and SMMF could experience higher volatility due to their focus on emerging markets and use of active management strategies.
• Market Risk: Underlying asset performance and overall market conditions can impact both ETFs' returns.
• Management Risk: The success of the ETFs relies heavily on the portfolio managers' ability to pick winning investments and navigate market fluctuations.

Who Should Consider Investing:

• Investors seeking exposure to emerging markets small-cap stocks with the potential for outperformance.
• Income-oriented investors looking for diversification beyond traditional fixed-income investments.
• Investors comfortable with higher volatility and a longer investment time horizon.

Fundamental Rating Based on AI: 7/10

Spinnaker ETF Series demonstrates promise with its active management strategies and initial outperformance. However, the series' recent launch limits the historical data available for comprehensive analysis. The relatively small assets under management and limited market share also warrant consideration. The AI rating acknowledges the potential but highlights the need for extended observation to solidify its evaluation.

Resources:

• Spinnaker Investment Group website: https://www.spinnakerinvestment.com/
• ETF.com: https://www.etf.com/
• Morningstar: https://www.morningstar.com/

Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. Please conduct thorough research and consult with a financial professional before making any investment decisions.