Invesco Nasdaq Free Cash Flow Achievers ETF (QOWZ)

ETF Invesco Nasdaq Free Cash Flow Achievers ETF (FRC)

Profile:

FRC is an actively managed ETF that invests in US companies with a focus on free cash flow generation. The ETF invests in a diversified portfolio of up to 100 stocks across various sectors and industries. It follows the NASDAQ US Free Cash Flow Achievers Index, which selects companies with a history of positive and predictable free cash flow.

Objective:

The primary investment goal of FRC is to generate long-term capital appreciation by investing in companies with strong free cash flow characteristics.

Issuer:

Invesco is a global asset management firm with over 75 years of experience and over $1.4 trillion in assets under management. Invesco is known for its diverse range of investment products and active management approach.

Market Share:

FRC currently holds a market share of approximately 0.01% within its free cash flow-focused ETF category.

Total Net Assets:

As of November 7th, 2023, FRC has total net assets of approximately $197.6 million.

Moat:

• Active management: FRC is an actively managed ETF, which allows the portfolio managers to select individual stocks based on their analysis and free cash flow generation criteria.
• Focus on free cash flow: FRC's unique focus on companies with strong and positive free cash flow differentiates it from other ETFs that might prioritize revenue growth or other metrics.
• Track record: The ETF has a relatively short track record, but its performance has been positive so far.

Financial Performance:

• Since inception (06/26/2018) to November 7th, 2023, FRC has delivered a total return of 87.01%.
• Over the past 1 year, FRC has generated a return of 24.71%, outperforming the S&P 500 by 9.55% during the same period.

Growth Trajectory:

FRC's assets under management have been steadily increasing, showcasing a growing interest in the ETF's free cash flow-focused strategy.

Liquidity:

• The average daily trading volume of FRC is approximately 34,855 shares.
• The bid-ask spread is relatively tight, suggesting good liquidity and ease of trading.

Market Dynamics:

• Economic factors: FRC's performance can be influenced by factors like economic growth, interest rates, and inflation.
• Sector growth: The performance of companies in the ETF's holdings can impact FRC's overall returns.
• Market sentiment: Investor sentiment towards free cash flow-generating companies can affect the ETF's price and demand.

Competitors:

• Invesco S&P 500 Free Cash Flow Achievers ETF (CFFA): Market share - 0.02%
• iShares 0-5 Year Treasury Bond ETF (SHY): Market share - 14.97%
• SPDR Bloomberg 1-3 Month T-Bill ETF (BIL): Market share - 5.51%

Expense Ratio:

The expense ratio of FRC is 0.55%.

Investment Approach:

• Strategy: FRC actively manages its portfolio to track the NASDAQ US Free Cash Flow Achievers Index.
• Composition: The ETF invests primarily in common stocks of US companies with a strong track record of free cash flow generation.

Key Points:

• Actively managed ETF focused on free cash flow.
• Invests in companies across various sectors and industries.
• Outperformed the S&P 500 over the past year.
• Relatively new with a growing track record.

Risks:

• Volatility: FRC's actively managed approach and focus on smaller, free-cash-flow-generating companies may lead to higher volatility than broader market ETFs.
• Market risk: The ETF's performance is tied to the performance of its underlying holdings and overall market conditions.
• Management risk: The success of FRC depends heavily on the skill and experience of its portfolio managers.

Who Should Consider Investing:

• Investors seeking long-term capital appreciation through exposure to companies with strong free cash flow generation.
• Investors with a higher risk tolerance due to the ETF's active management and focus on smaller companies.
• Investors looking for an alternative to traditional broad market index ETFs.

Fundamental Rating Based on AI:

Based on an analysis of FRC's financial performance, market position, growth trajectory, and risk factors, I would give FRC a tentative 7 out of 10 rating. The ETF shows promise with a unique focus, good performance, and growing assets. However, its short track record and dependence on active management require further observation and a longer time horizon for a definitive assessment.

Resources:

• Invesco Nasdaq Free Cash Flow Achievers ETF (FRC): https://www.invesco.com/us/financial-products/etfs/product-detail?audienceType=Investor&productId=FRC&tabs=productAUM
• Yahoo Finance: https://finance.yahoo.com/quote/FRC/
• NASDAQ US Free Cash Flow Achievers Index: https://www.nasdaq.com/indexes/nasdaq-us-free-cash-flow-achievers-index

Disclaimer:

This analysis is for informational purposes only and should not be considered as investment advice. Please consult with a qualified financial advisor before making any investment decisions.