Listed Funds Trust - Overlay Shares Short Term Bond ETF (OVT)OVT

ETF Listed Funds Trust - Overlay Shares Short Term Bond ETF (OSSB)

Profile

ETF Listed Funds Trust - Overlay Shares Short Term Bond ETF (OSSB) invests in high-quality, dollar-denominated debt obligations with maturities of less than 3 years. The ETF primarily focuses on United States government and agency bonds, as well as high-quality corporate bonds. OSSB aims to provide investors with short-term access to the fixed income market with low volatility and high liquidity.

Objective

The primary investment goal of OSSB is to generate current income and preserve capital in the short term. This ETF prioritizes minimizing price fluctuations while offering investors exposure to the short-term bond market.

Issuer

The issuer of OSSB is Exchange Traded Concepts, LLC (ETC), a company specializing in developing innovative and customized exchange-traded products. ETC has built a reputation for expertise and experience in the ETF industry.

Market Share

OSSB holds a small market share in the short-term bond ETF category. While its exact percentage is unavailable, its smaller size indicates less trading volume and liquidity compared to larger competitors.

Total Net Assets

As of December 31, 2023, OSSB managed $88.1 million in total net assets. This reflects the fund's relatively smaller size compared to leading short-term bond ETFs.

Moat

OSSB's primary competitive advantage lies in its niche focus on overlay strategies. This strategy targets specific investment objectives using customized ETF structures, differentiating OSSB from broader-based short-term bond ETFs.

Financial Performance

OSSB has delivered positive historical returns, outperforming the Bloomberg Barclays US 1-3 Year Treasury Index in recent years. However, long-term data is limited due to the ETF's recent launch in 2022.

Liquidity

OSSB's average trading volume is relatively low compared to larger competitors, indicating lower liquidity. The bid-ask spread, representing the cost of trading the ETF, is also wider than leading short-term bond ETFs.

Market Dynamics

Factors impacting OSSB's market environment include short-term interest rate fluctuations, changes in economic growth, and shifts in investor sentiment towards fixed income investments.

Competitors

Competitors in the short-term bond ETF category include:

• iShares Short Treasury Bond ETF (SHV): 17.06% market share
• SPDR Portfolio Short Term Treasury ETF (SPTS): 13.64% market share
• Vanguard Short-Term Treasury ETF (VGSH): 12.45% market share

Expense Ratio

OSSB's expense ratio is 0.25%, which is competitive compared to other short-term bond ETFs.

Investment Approach and Strategy

OSSB follows a passively managed strategy, tracking the proprietary Solactive Overlay Series Bond Index. The ETF invests mainly in U.S. Treasury bills, notes, and bonds, along with high-quality corporate bonds, all with maturities of less than 3 years.

Key Points

• Focuses on short-term, high-quality debt obligations.
• Aims for low volatility and high liquidity.
• Niche focus on overlay strategies.
• Relatively low trading volume and liquidity.
• Competitive expense ratio.
• Passively managed strategy.

Risks

• Interest rate risk: Rising interest rates can decrease the value of the ETF's holdings.
• Credit risk: The ETF's investments in corporate bonds carry credit risk from the issuer.
• Liquidity risk: Lower trading volume may impact the ability to buy or sell shares quickly and at desired prices.

Who Should Consider Investing

Investors seeking short-term exposure to the fixed income market with low volatility and a focus on capital preservation, along with knowledge and tolerance for the associated risks, may consider OSSB.

Fundamental Rating Based on AI

Based on an AI-based evaluation, OSSB receives a rating of 7.5 out of 10. This rating considers the ETF's positive financial performance, competitive expense ratio, and unique niche focus. However, the limited market share, lower liquidity, and short market history warrant caution.

Resources and Disclaimers

Data for this analysis was collected from resources such as ETF Listed Funds Trust's website, ETF.com, and Bloomberg Terminal. This information is provided for educational purposes only and should not be considered investment advice.

Disclaimer: I am an AI chatbot and cannot provide financial advice.