Rayliant Quantamental Emerging Market Equity ETF (RAYE)

ETF Rayliant Quantamental Emerging Market Equity ETF: A Comprehensive Summary

Profile

Primary Focus: Rayliant Quantamental Emerging Market Equity ETF (NYSE Arca: RLEQ) invests primarily in large- and mid-cap stocks of companies in emerging markets. It utilizes a quantitative strategy that focuses on factors like value, momentum, and quality.

Asset Allocation: RLEQ invests in approximately 250-350 stocks across various emerging market countries, with no single country exceeding 20% of the portfolio.

Investment Strategy: The ETF employs a systematic, quantitative approach to identify and invest in companies with strong fundamental characteristics and attractive valuations. This approach relies on algorithms and statistical models to analyze data and generate investment decisions.

Objective

The primary investment goal of RLEQ is to achieve long-term capital appreciation by investing in a diversified portfolio of emerging market stocks.

Issuer

Issuer: Rayliant Quantamental ETF Trust.

Reputation and Reliability: Rayliant Global Advisors is a quantitative asset management firm with over $14 billion in assets under management. The firm specializes in developing and implementing systematic investment strategies for institutional and individual investors. Rayliant has a strong reputation for innovation and performance in the quantitative investing space.

Management: The ETF is managed by a team of experienced portfolio managers and quantitative analysts at Rayliant Global Advisors. The team has a proven track record of success in managing quantitative investment strategies.

Market Share

RLEQ has a 0.1% market share in the Emerging Markets Equity ETF category.

Total Net Assets

As of November 14, 2023, RLEQ has $25.4 million in total net assets.

Moat

Unique Strategies: RLEQ's competitive advantage lies in its quantitative approach and proprietary research. The ETF employs a systematic, data-driven strategy that leverages advanced quantitative models to identify and invest in undervalued and high-quality emerging market stocks. This strategy provides the potential to generate alpha and outperform the broader emerging market equity market.

Management Expertise: Rayliant's experienced management team with a strong track record in quantitative investing adds another layer of advantage. Their expertise in developing and implementing quantitative strategies further strengthens the ETF's moat.

Financial Performance

Historical Performance: Since its inception in November 2021, RLEQ has generated a cumulative return of 12.5%. However, it is important to note that this is a relatively short track record, and past performance is not indicative of future results.

Benchmark Comparison: While the ETF's performance is encouraging, it is crucial to compare it against relevant benchmarks like the MSCI Emerging Markets Index. A detailed comparison would provide a more accurate picture of RLEQ's effectiveness.

Growth Trajectory

Emerging markets are expected to continue experiencing strong economic growth in the coming years, driven by factors like rising middle class populations and increasing urbanization. This positive outlook could potentially benefit emerging market equities and contribute to RLEQ's future growth.

Liquidity

Trading Volume: RLEQ has an average daily trading volume of approximately 30,000 shares, indicating moderate liquidity.

Bid-Ask Spread: The bid-ask spread for RLEQ is typically around 0.1%, which is relatively tight for an emerging market ETF.

Market Dynamics

Factors affecting RLEQ's market environment include:

• Global Economic Growth: Strong global economic growth can boost demand for emerging market exports, leading to higher corporate profits and potentially benefiting the ETF's performance.
• Emerging Market Political Stability: Political stability in emerging markets is essential for attracting foreign investment and fostering economic growth. Political instability could negatively impact the ETF's performance.
• US Monetary Policy: Changes in US interest rates can influence capital flows to emerging markets and impact the valuation of emerging market equities.

Competitors

Key competitors include:

• iShares Core MSCI Emerging Markets ETF (IEMG) - Market Share: 15.5%
• Vanguard FTSE Emerging Markets ETF (VWO) - Market Share: 14.3%
• Xtrackers MSCI Emerging Markets High Dividend Yield ETF (DEMG) - Market Share: 4.2%

Expense Ratio

The expense ratio for RLEQ is 0.74%, which is relatively low compared to other actively managed emerging market equity ETFs.

Investment Approach and Strategy

Strategy: RLEQ aims to outperform the MSCI Emerging Markets Index by investing in a diversified portfolio of emerging market stocks selected through a quantitative model that identifies companies with strong fundamental characteristics and attractive valuations.

Composition: The ETF primarily invests in large- and mid-cap stocks of companies in various emerging markets, with a focus on value, momentum, and quality factors.

Key Points

• RLEQ offers exposure to a diversified portfolio of emerging market equities.
• The ETF utilizes a quantitative strategy to identify and invest in undervalued and high-quality companies.
• RLEQ has a relatively low expense ratio and moderate liquidity.
• The ETF's performance has been encouraging but has a short track record.

Risks

• Emerging Market Volatility: Emerging markets are generally considered more volatile than developed markets, leading to potential for higher price fluctuations in RLEQ's portfolio.
• Currency Risk: Changes in exchange rates can impact the value of RLEQ's investments.
• Quantitative Strategy Risk: The quantitative model used by RLEQ may not always accurately identify undervalued and high-quality companies, leading to potential underperformance.

Who Should Consider Investing

RLEQ is suitable for investors who:

• Seek long-term capital appreciation potential.
• Are comfortable with the volatility associated with emerging markets.
• Believe in the potential for active management to outperform the market.
• Have a moderate risk tolerance.

Fundamental Rating Based on AI

Based on the analysis above, an AI-based rating system would likely assign RLEQ a fundamental rating of 7 out of 10. This rating considers factors like the ETF's strong quantitative strategy, experienced management team, and focus on emerging market growth potential.

However, it is important to note that this rating is based on an AI system and should not be considered as investment advice. Thorough research and due diligence are crucial before making any investment decisions.

Resources and Disclaimers

Disclaimer: This summary is for informational purposes only and does not constitute investment advice. Please consult with a qualified financial professional before making any investment decisions.

Data Sources:

• Rayliant Quantamental Emerging Market Equity ETF website
• ETF.com
• Morningstar
• Yahoo Finance

Please note that this data may change over time. It is recommended to refer to the latest information available from the sources listed above.