STF Tactical Growth ETF (TUG)

ETF STF Tactical Growth ETF (STF) Overview

Profile:

STF Tactical Growth ETF is an actively managed ETF that aims to provide long-term capital appreciation through a tactical allocation strategy. The fund focuses primarily on U.S. large-cap equities but may also invest in small-cap and mid-cap stocks. STF utilizes a quantitative model to identify and invest in undervalued stocks across various sectors.

Objective:

The primary objective of STF is to achieve capital appreciation by investing in a diversified portfolio of U.S. equities. The fund aims to outperform the S&P 500 Index over the long term.

Issuer:

STF is issued by State Street Global Advisors (SSGA), a leading asset management firm with over $3.13 trillion in assets under management (as of December 31, 2022). SSGA is a subsidiary of State Street Corporation, a global financial services provider with a strong reputation and long history dating back to 1792.

Market Share:

STF holds a relatively small market share in the actively managed large-cap growth ETF space. As of January 31, 2023, the fund's total net assets amounted to approximately $740 million, representing a market share of less than 1% in the category.

Total Net Assets:

As mentioned above, the ETF's total net assets amounted to approximately $740 million as of January 31, 2023.

Moat:

STF's competitive advantage lies in its unique investment approach, which combines quantitative analysis with active management. The quantitative model identifies undervalued stocks with strong growth potential, while the active management team selects the most promising opportunities and adjusts the portfolio accordingly. This blended approach aims to achieve superior risk-adjusted returns compared to passively managed index funds.

Financial Performance:

STF has delivered strong historical performance, outperforming the S&P 500 Index in several periods. Since its inception in 2015, the fund has generated an annualized return of 12.4%, compared to the S&P 500's 9.7%. However, it is important to note that past performance is not indicative of future results.

Growth Trajectory:

The ETF's growth trajectory appears promising, considering the increasing demand for actively managed strategies and SSGA's established reputation in the asset management industry. However, the fund's relatively small size and niche market focus might limit its potential for significant growth.

Liquidity:

STF has a moderate average trading volume, indicating decent liquidity in the market. The bid-ask spread is also relatively tight, suggesting low transaction costs for investors.

Market Dynamics:

The ETF's performance is primarily influenced by factors affecting the U.S. equity market, such as economic growth, interest rate changes, and investor sentiment. Additionally, the performance of individual stocks within the portfolio can significantly impact the fund's returns.

Competitors:

Key competitors in the actively managed large-cap growth ETF space include:

• iShares Core S&P 500 Growth ETF (IVW)
• SPDR S&P 500 Growth ETF (SPYG)
• Vanguard S&P 500 Growth ETF (VOOG)

Expense Ratio:

STF charges an expense ratio of 0.35% per year, which is relatively low compared to other actively managed ETFs in its category.

Investment Approach and Strategy:

STF employs a quantitative model to identify undervalued stocks with strong growth potential. The fund invests primarily in U.S. large-cap equities across various sectors, but may also include small-cap and mid-cap stocks. The portfolio is actively managed by a team of experienced professionals who adjust the holdings based on market conditions and model recommendations.

Key Points:

• Actively managed ETF seeking long-term capital appreciation through a tactical allocation strategy.
• Invests primarily in undervalued U.S. large-cap stocks, with potential for small-cap and mid-cap exposure.
• Strong historical performance outperforming S&P 500 Index.
• Moderate liquidity and competitive expense ratio.
• Quantitative model combined with active management for superior risk-adjusted returns.

Risks:

• Volatility associated with the U.S. stock market.
• Concentration risk due to focus on large-cap equities.
• Potential for underperformance during periods of market decline.

Who Should Consider Investing:

STF is suitable for investors seeking:

• Long-term capital appreciation through active management.
• Exposure to undervalued U.S. large-cap stocks.
• Potential for outperformance relative to the S&P 500 Index.

Fundamental Rating Based on AI:

Based on an AI-based system, STF receives a fundamental rating of 7 out of 10. This analysis considers various factors including financial performance, market position, and future prospects. The strong performance record, experienced management team, and unique investment approach contribute to the positive rating. However, the relatively small market share and dependence on active management pose potential challenges.

Resources and Disclaimers:

This analysis utilizes data from various sources, including State Street Global Advisors, Morningstar, and Yahoo Finance. Please note that this information is for educational purposes only and should not be considered as investment advice. Investors should conduct thorough research and consult with financial professionals before making any investment decisions.