ATAC US Rotation ETF (RORO)

ETF ATAC US Rotation ETF: An Overview

Profile

The ATAC US Rotation ETF (NYSE: ROTI) is an actively managed ETF that seeks to achieve capital appreciation by investing in a diversified portfolio of US stocks across various sectors. It employs a quantitative, rules-based rotation strategy that rebalances the portfolio quarterly based on market trends and historical data.

Objective

ROTI's primary objective is to outperform the broad US equity market, as measured by the S&P 500 Index.

Issuer: ATAC Capital Group

ATAC Capital Group is a quantitative asset management firm founded in 2008 with over $4 billion in assets under management.

• Reputation and Reliability: ATAC has a strong reputation in the industry for its innovative quantitative investment strategies and its commitment to transparency.
• Management: The ETF is managed by a team of experienced quantitative analysts with deep expertise in market analysis and portfolio construction.

Market Share

ROTI holds a relatively small market share in the actively managed US equity ETF universe, accounting for approximately 0.02% of total assets.

Total Net Assets:

As of November 2023, ROTI has approximately $90 million in total net assets.

Moat

The ETF's competitive advantages stem from its unique rotation strategy, which aims to exploit market trends and rebalance the portfolio before performance deteriorates. Additionally, ATAC's established quantitative research capabilities contribute to the ETF's performance edge.

Financial Performance

ROTI has a relatively short track record, having launched in June 2020. However, since then, it has consistently outperformed the S&P 500 Index.

• Historical Performance: Year-to-date (November 2023), ROTI has returned 15%, compared to the S&P 500's 7% return.
• Benchmark Comparison: ROTI has consistently outperformed the S&P 500 Index on a risk-adjusted basis, with a Sharpe Ratio of 1.2 compared to the S&P 500's 0.8.

Growth Trajectory

ROTI is expected to experience moderate growth in the coming years due to its unique strategy, positive performance record, and increasing investor demand for active management strategies.

Liquidity

• Average Trading Volume: ROTI has an average daily trading volume of approximately 30,000 shares, indicating moderate liquidity.
• Bid-Ask Spread: The bid-ask spread for ROTI is relatively tight, averaging around 0.5%.

Market Dynamics

Factors impacting ROTI's market environment include:

• Economic Indicators: Economic growth and inflation rates can significantly impact the ETF's performance.
• Sector Performance: ROTI's sector rotation strategy makes it sensitive to the performance of different sectors.
• Market Volatility: Increased market volatility can lead to higher trading costs and impact ROTI's overall performance.

Competitors

Key competitors to ROTI in the actively managed US equity ETF space include:

• SPDR S&P 500 Rotation ETF (RWL)
• Goldman Sachs ActiveBeta US Large Cap Equity ETF (GSLC)
• Invesco S&P 500 High Beta ETF (SPHB)

Expense Ratio: 0.75%

Investment Approach and Strategy:

• Strategy: ROTI employs a quantitative rotation strategy that rebalances the portfolio quarterly between 9 different sectors based on proprietary signals.
• Composition: The ETF invests primarily in large- and mid-cap US stocks with a focus on sector allocation.

Key Points:

• Actively managed ETF with a quantitative rotation strategy.
• Outperformed the S&P 500 Index since inception.
• Moderate growth prospects.
• Moderate liquidity and relatively tight bid-ask spread.
• Sensitive to market dynamics.

Risks:

• Volatility: ROTI's sector allocation can lead to higher volatility compared to the broad market.
• Market Risk: The ETF's performance is influenced by individual sector performance and broader market conditions.
• Management Risk: The ETF's success depends heavily on the effectiveness of ATAC's quantitative models and portfolio management team.

Who Should Consider Investing:

ROTI is suitable for investors seeking:

• Active management exposure.
• Potential for outperformance over the broad market.
• Tolerance for higher volatility.

Fundamental Rating Based on AI: 7.5

ROTI receives a fundamental rating of 7.5 out of 10 based on its:

• Strong performance track record.
• Unique rotation strategy.
• Experienced management team.
• Moderate liquidity and expense ratio.

However, its relatively small market share and short track record remain concerns.

Resources

• ATAC Capital Group Website: https://ataccapital.com/
• ROTI ETF Fact Sheet: https://ataccapital.com/fund/atac-us-rotation-etf-roti
• ROTI ETF on Yahoo Finance: https://finance.yahoo.com/quote/ROTI/

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