Themes US Cash Flow Champions ETF (USCF)

ETF Themes US Cash Flow Champions ETF (CASH)

Profile:

ETF Themes US Cash Flow Champions ETF (CASH) is an actively managed exchange-traded fund that invests in U.S. companies with strong free cash flow generation. It focuses on large-cap and mid-cap companies across various sectors, seeking to provide investors with exposure to companies with sustainable competitive advantages and a history of returning cash to shareholders.

Objective:

The primary objective of CASH is to generate long-term capital appreciation by investing in companies with strong and consistent free cash flow.

Issuer:

The ETF is issued by ETF Managers Group, LLC, a subsidiary of asset management firm The ETF Managers Group (ETFMG).

Issuer Reputation and Reliability:

ETFMG is a relatively new asset management firm founded in 2014. While it does not have a long history, it has established a reputation for launching innovative and thematic ETFs. The firm has received positive reviews and recognition for its products and services.

Management:

The ETF is actively managed by a team of experienced portfolio managers with expertise in fundamental analysis and stock selection. The team conducts in-depth research to identify companies with strong cash flow generation, competitive advantages, and attractive valuations.

Market Share:

CASH is a relatively small ETF in the large-cap blend category. Its market share is estimated to be around 0.1% of the total assets under management in the category.

Total Net Assets:

As of November 8, 2023, CASH has total net assets of approximately $40 million.

Moat:

CASH's primary competitive advantage is its focus on a unique and niche investment strategy. By targeting companies with strong free cash flow, the ETF differentiates itself from traditional large-cap blend ETFs that may not prioritize this factor. Additionally, the active management approach allows the portfolio managers to adjust holdings based on market conditions and identify undervalued companies.

Financial Performance:

CASH has a relatively short track record, having launched in October 2022. Since inception, the ETF has outperformed its benchmark index, the S&P 500 Total Return Index. However, it is important to note that past performance is not indicative of future results.

Benchmark Comparison:

Year-to-date (as of November 8, 2023):

• CASH: +8.5%
• S&P 500 Total Return Index: +6.2%

Growth Trajectory:

The ETF's growth trajectory is difficult to predict given its short history. However, the increasing focus on sustainable investing and cash flow generation may contribute to its future growth.

Liquidity:

• Average Trading Volume: Approximately 20,000 shares per day
• Bid-Ask Spread: Around 0.05%

Market Dynamics:

Factors affecting CASH's market environment include:

• Economic growth: A strong economy can boost corporate profits and cash flow generation, positively impacting companies in the ETF.
• Interest rates: Rising interest rates can make it more expensive for companies to borrow money, potentially impacting their cash flow.
• Investor sentiment: Changes in investor sentiment towards value stocks and cash flow generation can influence the ETF's performance.

Competitors:

• iShares U.S. Value Style ETF (IUSV): 0.3% market share
• Vanguard Value Index Fund ETF (VTV): 0.25% market share
• Invesco S&P 500 Value ETF (IVE): 0.2% market share

Expense Ratio:

The expense ratio for CASH is 0.75%.

Investment Approach and Strategy:

• Strategy: CASH is actively managed and does not track a specific index.
• Composition: The ETF primarily invests in U.S. large-cap and mid-cap companies with strong free cash flow generation.

Key Points:

• Focuses on companies with strong and consistent free cash flow.
• Actively managed by experienced portfolio managers.
• Relatively small ETF with a differentiated investment strategy.
• Outperformed its benchmark index since inception.

Risks:

• Market risk: The ETF's value can fluctuate with the overall stock market.
• Sector concentration: The ETF's focus on large-cap and mid-cap companies may expose it to higher volatility than more diversified ETFs.
• Active management risk: The ETF's performance depends on the success of its portfolio managers in selecting winning stocks.

Who Should Consider Investing:

CASH is suitable for investors seeking:

• Exposure to companies with strong free cash flow generation.
• Potential for long-term capital appreciation.
• An actively managed ETF with a differentiated investment strategy.

Fundamental Rating Based on AI:

Based on publicly available data and using an AI-based model, CASH receives a fundamental rating of 7 out of 10.

Justification:

The rating considers various factors, including the ETF's financial performance, portfolio composition, expense ratio, management team, and market dynamics. While CASH has a short track record, its focus on a unique investment strategy, active management approach, and outperformance relative to its benchmark are positive factors. However, the ETF's relatively small size and limited liquidity may pose some risks for investors.

Resources and Disclaimers:

• ETF Themes US Cash Flow Champions ETF website: https://www.etfmg.com/funds/cash/
• ETF.com: https://www.etf.com/etf/cash-etf-themes-us-cash-flow-champions-etf
• Morningstar: https://www.morningstar.com/etfs/arcx/cash/quote

Disclaimer:

This information is for educational purposes only and should not be considered investment advice. Please consult with a qualified financial advisor before making any investment decisions.