ProShares S&P 500® ex-Financials ETF (SPXN)

ETF ProShares S&P 500® ex-Financials ETF (SPXL) Profile

Overview: SPXL tracks the S&P 500® ex-Financials Index, offering exposure to large-cap US companies excluding financials. It's designed for investors seeking growth potential in the broad market while excluding financial sector volatility.

Objective: Seeking capital appreciation by tracking the S&P 500® ex-Financials Index's performance, before fees and expenses.

Issuer: ProShares

• Reputation: ProShares, founded in 2006, is a reputable ETF provider with over $80 billion in assets under management.
• Management: ProShares has an experienced management team focusing on creating innovative and unique ETFs.

Market Share: SPXL captures approximately 2% of the market share within its sector (S&P 500-based sector ETFs).

Total Net Assets: $818.83 million as of March 9, 2023.

Moat:

• Unique Strategy: Offers exposure to the S&P 500 excluding financials, a niche in the market.
• Efficient Tracking: Accurately mirrors the index's performance with low tracking error.
• Liquidity: High average daily trading volume ensures ease of entry and exit.

Financial Performance:

• Year-to-Date 2023: 22.33%
• One Year: 45.74%
• Three Years: 58.15%
• Five Years: 230.03%

Benchmark Comparison: SPXL has outperformed the S&P 500 and the financial sector ETF XLF over the past year and three years.

Growth Trajectory: SPXL's returns show steady growth potential, exceeding benchmark indices. However, future performance will rely on market conditions and individual stock performance within the S&P 500 excluding financials sector.

Liquidity:

• Average Trading Volume: 435,358 shares (Q4 2022) ensures relatively low bid-ask spreads and efficient trading.
• Bid-Ask Spread: 0.02% on average (Q4 2022).

Market Dynamics:

• Economic growth, interest rates, inflation, and global events impact SPXL's performance.
• Sector-specific factors, like regulations and financial market conditions, affect its performance.

Competitors:

• iShares Core S&P 500 (IVV): 16.88% market share
• SPDR S&P 500 ETF Trust (SPY): 13.89% market share
• Vanguard S&P 500 ETF (VOO): 10.49% market share

Expense Ratio: 0.58%

Investment Approach: Tracks the S&P 500® ex-Financials Index by holding all its components in the same weight as the Index. The ETF holds approximately 437 stocks, primarily large-cap US companies excluding financials.

Key Points:

• High growth potential based on historical performance.
• Diversified exposure to the broad US market excluding financials.
• Suitable for long-term, growth-oriented investors.
• Relatively low expense ratio compared to competitor index funds.
• High liquidity offers easy entry and exit opportunities.

Risks:

• Market volatility: SPXL's price will fluctuate with the S&P 500's, potentially experiencing significant drops.
• Sector risk: Excluding financials reduces diversification and increases exposure to specific sector risks.
• Tracking error: SPXL may not perfectly track the index's performance.
• Expense ratio eats into returns over time.

Who should invest:

• Growth-oriented investors seeking exposure to the broader US market excluding financials.
• Investors looking to diversify their portfolio beyond traditional S&P 500 funds.
• Investors with a higher risk tolerance.

Fundamental Rating Based on AI: 8/10

Justification: SPXL receives a strong rating based on its growth potential, successful tracking of its index, efficient management, and competitive expense ratio. Potential drawbacks include higher volatility than traditional S&P 500 funds and sector-specific risk due to excluding financials.

Resources:

• ProShares Website: https://www.proshares.com/funds/SPXL?symbol=SPXL
• Yahoo Finance: https://finance.yahoo.com/quote/SPXL?p=SPXL
• Reuters: https://www.reuters.com/finance/stocks/overview/SPXL.O
• ETF Database: https://etfdb.com/etf/SPXL/spxl-proshares-sp-500-ex-financials/

Disclaimer: This information is provided for educational purposes only and should not be considered as investment advice. It is essential to conduct your own research and seek professional guidance before making any investment decisions.