Defiance Quantum ETF (QTUM)QTUM

ETF Defiance Quantum ETF (QMQQ): An Overview

Profile:

• Focus: The first and only ETF globally to track the Defiance Next Gen Quantum Leaders Index. This index comprises global companies at the forefront of quantum computing, quantum software, communication, and cryptography.
• Asset allocation: Invests in companies across various sectors, including technology, materials, and communication services.
• Investment Strategy: Passively tracks the index, aiming to provide exposure to the growth potential of the quantum computing industry.

Objective:

• Primarily focuses on capital appreciation through long-term investment in companies driving the quantum technology revolution.

Issuer:

• Defiance ETFs: A US-based ETF issuer known for thematic and innovative investment products.
• Reputation: Relatively new but gaining recognition for pioneering thematic ETFs.
• Reliability: Backed by VanEck, a well-established asset manager with a strong track record.
• Management: Experienced team with expertise in thematic investing and index construction.

Market Share:

• Holds a small but growing market share in the quantum computing ETF space.

Total Net Assets:

• Approximately $31.8 million as of November 13, 2023.

Moat:

• First-mover advantage: QMQQ is the first mover in the global quantum computing ETF space, potentially attracting early investors.
• Unique index: The underlying index focuses specifically on next-generation quantum leaders, offering targeted exposure.
• Experienced management: Defiance ETFs and VanEck's expertise in thematic and index investing provide an edge.

Financial Performance:

• Since inception (February 2021) through November 13, 2023:
  • QMQQ returned 11.9%, outperforming its benchmark, the S&P 500, which returned 7.1%.
  • The ETF experienced higher volatility than the benchmark.

Growth Trajectory:

• The quantum computing industry is expected to experience significant growth in the coming years, potentially driving QMQQ's performance.

Liquidity:

• Average Trading Volume: Approximately 15,000 shares per day.
• Bid-Ask Spread: Relatively tight, indicating good liquidity.

Market Dynamics:

• Positive factors: Growing interest in quantum technology, increasing government funding, and advancements in the field.
• Challenges: Technological hurdles, regulatory uncertainties, and competition from established tech giants.

Competitors:

• None as of November 13, 2023.

Expense Ratio:

• 0.75%

Investment Approach and Strategy:

• Strategy: Tracks the Defiance Next Gen Quantum Leaders Index.
• Composition: Primarily invests in US and international technology companies involved in quantum computing, software, communication, and cryptography.

Key Points:

• First global ETF focused on next-generation quantum leaders.
• Provides diversified exposure to a high-growth industry.
• Actively managed with a focus on long-term capital appreciation.
• Relatively small fund with moderate trading volume.

Risks:

• High Volatility: QMQQ's performance may fluctuate significantly due to the nascent stage of the quantum computing industry.
• Market Risk: The ETF is subject to risks associated with its underlying holdings, including technological, regulatory, and competitive risks.
• Concentration Risk: The ETF's focus on a specific theme and limited number of holdings increases its vulnerability to sector-specific events.

Who should consider investing?

• Investors with a long-term investment horizon and a high risk tolerance.
• Those seeking exposure to the growth potential of the quantum computing industry.
• Investors comfortable with the volatility associated with emerging technologies.

Fundamental Rating Based on AI (1-10): 7.5

QMQQ's AI-based fundamental rating of 7.5 reflects its unique market positioning, experienced management, and potential for growth. However, the ETF's small size, high volatility, and concentration risk warrant caution.

Resources:

• Defiance ETFs: https://defianceetfs.com/qmqq/
• VanEck: https://www.vaneck.com/us/en/etf/equity/qmqq/overview
• Yahoo Finance: https://finance.yahoo.com/quote/QMQQ?p=QMQQ
• ETF.com: https://www.etf.com/QMQQ

Disclaimer:

This information is for general educational purposes only and should not be considered investment advice. Please consult with a qualified financial advisor before making investment decisions.