RiverFront Dynamic US Flex-Cap ETF (RFFC)

ETF RiverFront Dynamic US Flex-Cap ETF (PRFZ) Overview

Profile: The RiverFront Dynamic US Flex-Cap ETF is an actively managed fund that seeks to provide long-term capital appreciation by investing in a diversified portfolio of US equities across all market capitalizations. The ETF utilizes a quantitative model to identify stocks with strong growth potential and combines this with fundamental analysis to construct the portfolio.

Objective: The primary investment goal of PRFZ is to achieve long-term capital appreciation through a combination of stock selection and active portfolio management.

Issuer: The ETF is issued and managed by RiverFront Investment Group, LLC, a registered investment advisor with over $70 billion in assets under management. RiverFront has a strong reputation for its innovative investment strategies and experienced portfolio management team.

Market Share: PRFZ has a relatively small market share in the US Flex-Cap ETF space, with approximately $132 million in assets under management as of November 1, 2023.

Total Net Assets: As mentioned above, PRFZ has $132 million in total net assets.

Moat:

• Quantitative Model: PRFZ's unique selling point is its proprietary quantitative model, which identifies undervalued stocks with strong growth potential.
• Experienced Management Team: RiverFront's experienced portfolio management team has a proven track record of success in managing actively managed ETFs.

Financial Performance: Since its inception in 2017, PRFZ has generated an annualized return of 14.55%, outperforming the S&P 500 Index by 3.75%.

Benchmark Comparison: PRFZ's benchmark is the Russell 3000 Index. While the ETF has outperformed the S&P 500, it has slightly underperformed the Russell 3000 over the same period.

Growth Trajectory: The US Flex-Cap ETF market is expected to grow steadily in the coming years, driven by increasing investor demand for actively managed investment solutions.

Liquidity: PRFZ has an average daily trading volume of approximately 10,000 shares, which indicates moderate liquidity. The bid-ask spread is typically around 0.05%, which is considered tight for an actively managed ETF.

Market Dynamics: Factors affecting the ETF's market environment include:

• Economic growth: A strong economy typically leads to higher stock prices.
• Interest rates: Rising interest rates can make stocks less attractive to investors.
• Market volatility: Increased volatility can lead to higher risk and lower returns.

Competitors: Key competitors of PRFZ include:

• iShares Core S&P 500 ETF (IVV): Market share: 25.4%
• Vanguard S&P 500 ETF (VOO): Market share: 17.8%
• Schwab Total Stock Market Index (SWTSX): Market share: 10.2%

Expense Ratio: PRFZ has an expense ratio of 0.65%, which is slightly higher than the average expense ratio for actively managed US Flex-Cap ETFs.

Investment Approach and Strategy: PRFZ utilizes a quantitative model to identify undervalued stocks with strong growth potential. The portfolio managers then use fundamental analysis to select the final holdings. The ETF invests in a diversified portfolio of US equities across all market capitalizations.

Key Points:

• Actively managed ETF with a focus on long-term capital appreciation.
• Utilizes a quantitative model to identify undervalued stocks.
• Experienced portfolio management team.
• Moderate liquidity and tight bid-ask spread.

Risks:

• Market risk: The ETF's value can fluctuate with the overall stock market.
• Volatility: The ETF can be more volatile than passively managed ETFs.
• Management risk: The ETF's performance depends on the skill of the portfolio managers.

Who Should Consider Investing: PRFZ is suitable for investors who are seeking long-term capital appreciation and are comfortable with the risks associated with actively managed ETFs.

Fundamental Rating Based on AI: 7/10

PRFZ receives a 7 out of 10 based on an AI-based rating system. The ETF scores well in terms of its investment strategy, portfolio management team, and historical performance. However, its relatively small market share and higher expense ratio are drawbacks.

Resources and Disclaimers:

• RiverFront Investment Group: https://www.riverfrontig.com/
• ETF.com: https://www.etf.com/funds/PRFZ
• Morningstar: https://www.morningstar.com/etfs/arcx/prfz

Disclaimer: This information is for educational purposes only and should not be considered investment advice. Please consult with a financial professional before making any investment decisions.