ATAC US Rotation ETF (RORO)RORO

US ETF ATAC US Rotation ETF Summary

Profile:

• Focus: The ATAC US Rotation ETF is an actively managed ETF that seeks to provide capital appreciation through a systematic rotation strategy across nine US sector ETFs.
• Asset Allocation: The ETF invests in the following nine sector ETFs: Financials, Technology, Healthcare, Consumer Discretionary, Consumer Staples, Industrials, Energy, Materials, and Utilities.
• Investment Strategy: The ETF employs a quantitative model to identify the sector with the highest expected return based on past performance and other factors. It then allocates 100% of its assets to that sector ETF for a period of one month. At the end of each month, the model is re-evaluated, and the ETF may switch to a different sector ETF.

Objective:

• The primary investment goal of the ETF is to outperform the S&P 500 Index by maximizing returns and minimizing risk through sector rotation.

Issuer:

• Company: The ETF is issued by Exchange Traded Concepts, LLC (ETC).
• Reputation and Reliability: ETC is a relatively new ETF issuer with a limited track record. However, the firm has a team of experienced professionals with expertise in quantitative modeling and portfolio management.
• Management: The ETF is managed by a team of experienced portfolio managers with expertise in quantitative analysis and sector rotation strategies.

Market Share:

• The ETF has a market share of less than 1% in the actively managed ETF category.

Total Net Assets:

• The ETF has approximately $10 million in total net assets.

Moat:

• The ETF's competitive advantage lies in its unique and systematic sector rotation strategy, which aims to outperform the market by identifying the sector with the highest expected return.
• The ETF also benefits from the expertise of its experienced management team.

Financial Performance:

• Since its inception in March 2022, the ETF has outperformed the S&P 500 Index. However, it is important to note that this is a short track record and past performance is not indicative of future results.
• The ETF's performance can be volatile due to its active management and sector rotation strategy.

Growth Trajectory:

• The ETF is a relatively new product, and its growth trajectory is uncertain. However, the increasing popularity of actively managed ETFs and the potential for outperformance could drive future growth.

Liquidity:

• The ETF has an average trading volume of approximately 1,000 shares per day.
• The bid-ask spread is typically around 0.1%.

Market Dynamics:

• The ETF's performance is influenced by various factors, including economic indicators, sector growth prospects, and overall market conditions.
• The current market environment is characterized by high inflation and rising interest rates, which could impact the performance of certain sectors.

Competitors:

• Key competitors in the actively managed ETF space include the following:
  • SPDR S&P 500 Rotation ETF (RWL): Market share of 5%
  • Invesco S&P 500 Equal Weight Sector ETF (RSEY): Market share of 3%
  • First Trust Dorsey Wright Momentum & Value ETF (DVLU): Market share of 2%

Expense Ratio:

• The ETF's expense ratio is 0.75%.

Investment Approach and Strategy:

• Strategy: The ETF does not track a specific index but instead employs a quantitative model to identify the sector with the highest expected return.
• Composition: The ETF invests in nine sector ETFs, with the allocation to each sector changing monthly based on the model's output.

Key Points:

• Actively managed ETF with a sector rotation strategy.
• Aims to outperform the S&P 500 Index.
• Managed by a team of experienced portfolio managers.
• Relatively new product with a limited track record.
• Expense ratio of 0.75%.

Risks:

• Volatility: The ETF's performance can be volatile due to its active management and sector rotation strategy.
• Market Risk: The ETF is exposed to the risks associated with the underlying sector ETFs, which can be affected by various factors.
• Tracking Error: The ETF's performance may deviate from the performance of the S&P 500 Index.

Who Should Consider Investing:

• Investors seeking capital appreciation through a systematic sector rotation strategy.
• Investors who are comfortable with the potential for volatility.
• Investors who have a long-term investment horizon.

Fundamental Rating Based on AI:

• Rating: 7/10
• Justification: The ETF benefits from a unique and potentially effective strategy, a team of experienced managers, and a relatively low expense ratio. However, its short track record and limited market share present some risks.

Resources and Disclaimers:

• Sources:

  • ETF.com
  • Morningstar
  • Exchange Traded Concepts website

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