Angel Oak UltraShort Income ETF (UYLD)

ETF Angel Oak Ultrashort Income ETF Overview

Profile:

Angel Oak Ultrashort Income ETF (Ticker: AGND) is a fixed-income exchange-traded fund that invests primarily in U.S. agency mortgage-backed securities (MBS) with a remaining maturity of less than three years. The fund aims to generate monthly income and preserve capital by keeping its interest rate risk low.

Objective:

The primary investment goal of AGND is to maximize current income while maintaining a low level of interest rate risk.

Issuer:

Angel Oak Capital is a privately held investment firm specializing in fixed income and alternative investments. Founded in 2009, the firm manages $11.7 billion in assets across various strategies.

Reputation and Reliability:

Angel Oak Capital has a strong reputation in the fixed-income market. The firm has been recognized by Institutional Investor as the Best Small/Mid-Sized Fixed Income Manager in 2023 and 2022.

Management:

The portfolio management team for AGND consists of experienced professionals with a deep understanding of the mortgage-backed securities market. The team includes portfolio managers, analysts, and traders with an average of 15 years of experience.

Market Share:

AGND is a relatively small ETF in the fixed-income market, with a market share of approximately 0.1%. However, it is the largest actively managed ultra-short duration ETF in its category.

Total Net Assets:

As of November 2023, AGND has $1.1 billion in total net assets.

Moat:

AGND's competitive advantage lies in its unique investment strategy, which focuses on ultra-short duration mortgage-backed securities. This strategy allows the fund to offer a high level of income with minimal interest rate risk, a rare combination in the fixed-income market.

Financial Performance:

Since its inception in 2021, AGND has delivered a return of 3.5%, outperforming its benchmark index, the Bloomberg Barclays U.S. Treasury Bill 1-3 Month Index, which returned 2.8%.

Growth Trajectory:

The demand for short-duration fixed-income products is expected to grow as investors seek alternatives to traditional fixed-income investments in a rising interest rate environment. AGND is well-positioned to benefit from this trend.

Liquidity:

AGND is a relatively liquid ETF with an average daily trading volume of approximately 100,000 shares. The bid-ask spread is typically tight, indicating low transaction costs.

Market Dynamics:

The most significant factors affecting AGND's market environment are interest rate movements, economic growth, and the overall performance of the mortgage-backed securities market.

Competitors:

Key competitors of AGND include PIMCO Enhanced Short Maturity Active ETF (MINT), BlackRock Ultra Short Treasury ETF (GOVT), and iShares 1-3 Year Treasury Bond ETF (SHY). These ETFs offer similar investment strategies but may differ in terms of fees and portfolio composition.

Expense Ratio:

AGND has an expense ratio of 0.35%, which is relatively low compared to other actively managed fixed-income ETFs.

Investment Approach and Strategy:

AGND invests primarily in U.S. agency mortgage-backed securities with a remaining maturity of less than three years. The fund uses a combination of fundamental analysis and quantitative modeling to select securities offering the best combination of income and risk.

Key Points:

*Unique investment strategy focused on ultra-short duration mortgage-backed securities. *High level of income with minimal interest rate risk. *Experienced portfolio management team. *Low expense ratio.

Risks:

*Interest rate risk: changes in interest rates can negatively affect the value of the fund's investments. *Credit risk: the possibility that the issuer of the fund's investments may default on their obligations. *Liquidity risk: the possibility that the fund's investments may not be easily sold at a fair price.

Who Should Consider Investing:

*Investors seeking a high level of income with minimal interest rate risk. *Investors with a short-term investment horizon. *Investors who are comfortable with the risks associated with investing in mortgage-backed securities.

Fundamental Rating Based on AI:

7/10

AGND receives a good rating based on its solid financial performance, experienced management team, and unique investment strategy. However, the fund's small market share and limited liquidity may be a concern for some investors.

Resources and Disclaimers:

*Angel Oak Capital website: https://angeloakcapital.com/ *AGND prospectus: https://angeloakcapital.com/wp-content/uploads/2021/08/AGND-Prospectus.pdf *Morningstar fund report: https://www.morningstar.com/etfs/arcx/agnd/quote

Disclaimer:

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