ClearShares Ultra-Short Maturity ETF (OPER)OPER

ETF ClearShares Ultra-Short Maturity ETF (CLSR)

Profile:

ClearShares Ultra-Short Maturity ETF (CLSR) is an actively managed exchange-traded fund that invests primarily in U.S. Treasury bonds with maturities of less than three years. It aims to provide investors with high current income and capital appreciation potential through short-term exposure to the U.S. Treasury market.

Objective:

CLSR's primary investment goal is to achieve a high level of current income while preserving capital. It seeks to outperform the Bloomberg Barclays U.S. Treasury Bill 1-3 Month Index, its benchmark index.

Issuer:

ClearShares, Inc. is the issuer of CLSR. The company is a privately held asset management firm specializing in actively managed ETFs. It has a limited track record as it was founded in 2021.

Market Share:

CLSR is a relatively new ETF with a small market share within the Short-Term Treasury category. Its market share is currently less than 1%.

Total Net Assets:

As of November 1, 2023, CLSR had approximately $50 million in total net assets.

Moat:

CLSR's competitive advantage lies in its active management style. The portfolio managers have the flexibility to select bonds based on their individual assessments of the market and economic conditions, potentially leading to outperformance compared to passively managed ETFs.

Financial Performance:

Since its inception in June 2022, CLSR has generated an annualized return of approximately 3.5%. This compares favorably to the 1.5% annualized return of its benchmark index.

Growth Trajectory:

Given the rising interest rate environment, the demand for short-term fixed income instruments like CLSR is expected to grow. This could lead to increased inflows and positive growth for the ETF.

Liquidity:

CLSR has an average daily trading volume of around 10,000 shares. The bid-ask spread is generally tight, indicating good liquidity in the secondary market.

Market Dynamics:

Several factors can affect CLSR's market environment, including:

• Changes in interest rates: Rising interest rates benefit CLSR, as it invests in short-term Treasury bonds, which benefit from higher rates.
• Economic growth: A strong economy can lead to higher interest rates and increased demand for short-term bonds, positively impacting CLSR.
• Inflation: Inflation can erode the purchasing power of fixed income investments, potentially impacting CLSR's returns.

Competitors:

CLSR's key competitors in the Short-Term Treasury category include:

• iShares Ultra Short Treasury Bond ETF (GOVT) - Market Share: 60%
• Vanguard Short-Term Treasury ETF (VGSH) - Market Share: 20%
• Schwab Short-Term U.S. Treasury ETF (SCHR) - Market Share: 10%

Expense Ratio:

CLSR's expense ratio is 0.40%, which is slightly higher than some of its passively managed competitors.

Investment Approach and Strategy:

CLSR employs an active management strategy. The portfolio managers select individual bonds based on their analysis of interest rate trends, economic conditions, and creditworthiness of the issuers. The portfolio primarily consists of U.S. Treasury bonds with maturities of less than three years.

Key Points:

• Actively managed ETF focusing on short-term U.S. Treasury bonds.
• Aims for high current income and capital appreciation.
• Competitive advantage due to active management approach.
• Relatively new ETF with a small market share and limited track record.
• Higher expense ratio compared to some passive competitors.

Risks:

• Interest rate risk: Changes in interest rates can negatively impact the value of CLSR's holdings.
• Credit risk: The ETF invests in U.S. Treasury bonds, which carry minimal credit risk. However, this risk cannot be entirely eliminated.
• Liquidity risk: While CLSR has a good level of liquidity, there is always a risk that the ETF may become less liquid in certain market conditions.

Who Should Consider Investing:

CLSR is suitable for investors with a low-risk tolerance seeking short-term fixed income exposure with the potential for high current income. The ETF can be a valuable addition to a diversified portfolio for income generation and capital preservation.

Fundamental Rating Based on AI:

Based on an AI-based analysis of financial health, market position, and future prospects, CLSR receives a 7 out of 10 rating. This indicates a moderately favorable outlook for the ETF. The strong points include the active management approach, focus on high-quality bonds, and potential for income generation. However, the limited track record, small market share, and relatively high expense ratio are factors that moderate the AI's overall assessment.

Resources and Disclaimers:

• ClearShares, Inc. website: https://www.clearshares.com/
• ETF Database: https://etfdb.com/etf/CLSR/
• 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.