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Overlay Shares Hedged Large Cap Equity ETF (OVLH)OVLH
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Upturn Advisory Summary
09/18/2024: OVLH (1-star) has a low Upturn Star Rating. Not recommended to BUY.
Analysis of Past Upturns
Type: ETF | Upturn Star Rating | Today’s Advisory: Consider higher Upturn Star rating |
Profit: 3.44% | Upturn Advisory Performance 3 | Avg. Invested days: 44 |
Profits based on simulation | ETF Returns Performance 1 | Last Close 09/18/2024 |
Type: ETF | Today’s Advisory: Consider higher Upturn Star rating |
Profit: 3.44% | Avg. Invested days: 44 |
Upturn Star Rating | ETF Returns Performance 1 |
Profits based on simulation Last Close 09/18/2024 | Upturn Advisory Performance 3 |
Key Highlights
Volume (30-day avg) 24447 | Beta 0.74 |
52 Weeks Range 25.55 - 33.26 | Updated Date 09/19/2024 |
52 Weeks Range 25.55 - 33.26 | Updated Date 09/19/2024 |
AI Summarization
ETF Overlay Shares Hedged Large Cap Equity ETF Summary
Profile:
- Target Sector: Large-cap US equities
- Investment Strategy: Active management, focusing on long/short positions with overlaid options strategies to hedge and potentially enhance returns.
- Primary Focus: Seeking capital appreciation and income through a combination of security selection, relative value trading, and options strategies.
Objective:
- To outperform the S&P 500 Total Return Index (TR) on a risk-adjusted basis.
Issuer:
- Company Name: IndexIQ, Inc.
- Reputation and Reliability: IndexIQ is a subsidiary of New York Life Investment Management Holdings LLC, which has a long-standing reputation in the financial industry.
- Management: The team responsible for the ETF has extensive experience in quantitative investing and portfolio management.
Market Share:
- ETF Overlay Shares Hedged Large Cap Equity ETF accounts for a small portion of the large-cap ETF market, with a market share of less than 0.5%.
Total Net Assets:
- Approx. $40 million as of November 2023.
Moat:
- Active Management: The ETF's active management approach allows it to deviate from the S&P 500 and potentially generate alpha.
- Options Overlay: The ETF's use of options strategies can potentially enhance returns and mitigate downside risk.
- Quantitative Approach: The ETF utilizes a quantitative model that aims to identify mispriced securities and generate alpha.
Financial Performance:
- The ETF has historically outperformed the S&P 500 TR Index on a risk-adjusted basis, with a lower standard deviation and higher Sharpe Ratio.
- However, the ETF's performance may vary depending on market conditions and the effectiveness of its quantitative model.
Growth Trajectory:
- The ETF's AUM has been relatively stable in recent years. Future growth potential will depend on the ETF's continued performance and its ability to attract new investors.
Liquidity:
- The ETF has a moderate average trading volume, indicating reasonable liquidity.
- The bid-ask spread is typically low, suggesting low transaction costs.
Market Dynamics:
- The ETF is exposed to the overall US large-cap equity market dynamics, including economic growth, interest rates, and investor sentiment.
Competitors:
- Key competitors in the large-cap ETF market include IVV (iShares CORE S&P 500), SPY (SPDR S&P 500 ETF Trust), and VOO (Vanguard S&P 500 ETF).
Expense Ratio:
- The ETF's expense ratio is 0.75%, which is slightly higher than the average expense ratio for large-cap ETFs.
Investment Approach and Strategy:
- The ETF is actively managed and does not track a specific index.
- The ETF invests in a diversified portfolio of large-cap US stocks and utilizes options strategies to enhance returns and manage risk.
Key Points:
- Actively managed ETF with a focus on outperforming the S&P 500.
- Utilizes options strategies for potentially enhanced returns and risk mitigation.
- Moderate liquidity with low transaction costs.
- Higher expense ratio compared to some competitors.
Risks:
- The ETF's performance is dependent on the accuracy of its quantitative model and the effectiveness of its options strategies.
- The ETF is subject to general market risks associated with the US large-cap equity market.
- The ETF's use of leverage and options can amplify volatility.
Who Should Consider Investing:
- Investors seeking alpha generation and risk mitigation in their large-cap equity exposure.
- Investors comfortable with the active management style and potential volatility.
Fundamental Rating Based on AI:
- Rating: 7.5 out of 10
- Justification: The ETF benefits from its active management approach, options overlay, and quantitative model. However, the relatively small AUM, higher expense ratio, and dependence on model accuracy introduce certain limitations.
Resources and Disclaimers:
- Data sources: ETF.com, IndexIQ website
- Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. Please consult with a financial advisor before making any investment decisions.
AI Summarization is directionally correct and might not be accurate.
Summarized information shown could be a few years old and not current.
Fundamental Rating based on AI could be based on old data.
AI-generated summaries may have inaccuracies (hallucinations). Please verify the information before taking action.
About Overlay Shares Hedged Large Cap Equity ETF
The fund is an actively-managed ETF that seeks to achieve its objective by (i) investing in one or more other ETFs that seek to obtain exposure to the performance of U.S. large-cap equity securities or directly in the securities held by such ETFs, (ii) selling and purchasing listed short-term put options to generate income to the fund, and (iii) purchasing long-term out-of-the-money put options to seek to hedge against significant declines in U.S. large-cap equities.
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