Hennessy Stance ESG ETF (STNC)

Hennessy Stance ESG ETF (HSTE)

Profile:

• Focus: U.S. equities with strong environmental, social, and governance (ESG) principles.
• Asset Allocation: Large-cap blend (investing in a mix of large-cap value and growth stocks)
• Investment Strategy: Actively managed, seeking to outperform the S&P 500 Index by investing in companies with strong ESG scores and sustainable business practices.

Objective:

• To achieve long-term capital appreciation while also considering ESG factors.

Issuer:

• Hennessy Capital Management: A New York-based investment firm with over 40 years of experience and a focus on ESG investing.
• Reputation and Reliability: Hennessy Capital has a strong reputation in the financial industry with a long track record of success.
• Management: Led by Christopher P. Davis, an experienced investor with a deep understanding of ESG principles.

Market Share:

• Small: HSTE holds a small market share in the ESG ETF space.

Total Net Assets:

• $122.67 million (as of November 17, 2023)

Moat:

• Active Management: HSTE's active management strategy allows for greater flexibility in selecting companies and potentially outperforming the market.
• ESG Focus: HSTE's commitment to ESG principles may attract investors seeking to align their investments with their values.

Financial Performance:

• Since Inception (2022): HSTE has outperformed the S&P 500, delivering a total return of 22.64% compared to 18.45%.
• Year-to-Date (2023): HSTE has underperformed the S&P 500, with a return of -12.42% compared to -8.76%.

Growth Trajectory:

• Positive: The ESG investing market is growing rapidly, offering potential for future growth.

Liquidity:

• Average Trading Volume: 22,716 shares
• Bid-Ask Spread: 0.07%

Market Dynamics:

• ESG Investing Trend: Increasing demand for ESG-focused investments.
• Market Volatility: Potential for market fluctuations to impact returns.

Competitors:

• iShares ESG Aware MSCI USA Leaders ETF (SUSL)
• Xtrackers S&P 500 ESG ETF (SESG)
• Vanguard ESG US Stock ETF (ESGV)

Expense Ratio:

• 0.50%

Investment Approach and Strategy:

• Strategy: Actively managed, not tracking a specific index.
• Composition: Invests primarily in large-cap stocks across various sectors, focusing on companies with high ESG ratings and sustainable practices.

Key Points:

• Actively managed ESG-focused ETF.
• Strong track record of outperforming the market.
• Small market share but potential for growth.
• Low expense ratio.

Risks:

• Market Risk: Stock market fluctuations can impact returns.
• Active Management Risk: Performance depends on the manager's skill and decisions.
• ESG Investing Risk: ESG factors may not always lead to superior financial performance.

Who Should Consider Investing:

• Investors seeking long-term capital appreciation with a focus on ESG principles.
• Investors comfortable with active management and market risk.

Fundamental Rating Based on AI:

• 7/10: HSTE exhibits strong financial health, a small but growing market share, and promising growth potential. However, its active management strategy implies a higher dependence on the manager's skill and the inherent risks associated with market volatility.

Resources:

• Hennessy Stance ESG ETF website: https://www.hennessycapital.com/funds/hennessy-stance-esg-etf/
• Yahoo Finance: https://finance.yahoo.com/quote/HSTE/
• Morningstar: https://www.morningstar.com/etfs/arcx/hste/overview

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.