REX VolMAXX Long VIX Futures Strat ETF (VMAX)VMAX

ETF REX VolMAXX Long VIX Futures Strat ETF (REXX) Overview:

Profile:

REXX is an actively managed exchange-traded fund (ETF) that seeks to deliver positive returns regardless of the market direction by investing in long volatility strategies through VIX futures contracts. It is not classified by any specific sector and invests in a diversified portfolio of VIX futures contracts across various maturities.

Objective:

The ETF's primary investment goal is to achieve positive absolute returns by capitalizing on market volatility fluctuations, primarily through exposure to VIX futures contracts.

Issuer:

• Issuer Name: VelocityShares
• Reputation and Reliability: VelocityShares is a relatively new ETF issuer founded in 2012 and acquired by Janus Henderson Investors in 2018. While it has a shorter history compared to some established players, it has built a reputation for offering innovative and niche ETFs.
• Management: The ETF is actively managed by a team of experienced portfolio managers at VelocityShares with expertise in volatility and derivative strategies.

Market Share:

REXX is a relatively small ETF in the volatility strategy ETF category, with a current market share of approximately 0.5%.

Total Net Assets:

As of November 10, 2023, REXX has approximately $36.5 million in total net assets.

Moat:

• Unique Strategy: REXX focuses on a specific niche within the volatility strategy space by utilizing a long VIX futures approach, which aims to profit from increases in market volatility.
• Active Management: The ETF benefits from active management by experienced professionals who can adjust the portfolio composition and adjust positions based on market conditions.

Financial Performance:

• Historical performance: REXX has experienced significant volatility in its price since inception, reflecting its exposure to the underlying VIX futures market.
• Benchmark Comparison: The ETF has generally outperformed the VIX Index, its benchmark, over various time periods. However, it is important to note that past performance is not indicative of future results.

Growth Trajectory:

REXX's growth trajectory is uncertain due to its dependence on market volatility. However, the increasing interest in volatility-related strategies and the ETF's unique approach could potentially drive future growth.

Liquidity:

• Average Trading Volume: REXX has a relatively low average daily trading volume, which can impact liquidity and potentially lead to wider bid-ask spreads.
• Bid-Ask Spread: The ETF's current bid-ask spread is relatively narrow, indicating reasonable liquidity.

Market Dynamics:

REXX is primarily influenced by factors that impact market volatility, including:

• Economic Indicators: Economic uncertainty, recessionary fears, and geopolitical events can increase volatility and benefit REXX.
• Interest Rate Changes: Rising interest rates can increase volatility and potentially benefit the ETF.
• Market Sentiment: Increased fear and uncertainty in the market can lead to higher volatility and benefit REXX.

Competitors:

• ProShares VIX Short-Term Futures ETF (VIXY): Market Share: 50%
• VelocityShares Daily Inverse VIX Short-Term ETN (XIV): Market Share: 25%
• iPath Series B S&P 500 VIX Short-Term Futures ETN (VXX): Market Share: 15%

Expense Ratio:

REXX has an expense ratio of 0.95%, which is considered average for actively managed volatility strategy ETFs.

Investment Approach and Strategy:

• Strategy: REXX utilizes a long VIX futures strategy, aiming to profit from increases in market volatility by buying VIX futures contracts across various maturities.
• Composition: The ETF primarily holds VIX futures contracts, with minor exposure to cash equivalents.

Key Points:

• Offers exposure to a long VIX futures strategy.
• Actively managed by experienced portfolio managers.
• Aims to achieve positive returns regardless of market direction.
• Higher risk profile due to its volatility exposure.

Risks:

• Volatility: REXX's price can be highly volatile, reflecting its exposure to VIX futures and the underlying market volatility.
• Market Risk: The ETF's performance is directly tied to the VIX futures market, which can be influenced by various factors beyond the ETF's control.
• Counterparty Risk: The ETF's use of derivatives exposes it to counterparty risk, where the counterparty may fail to fulfill its obligations.

Who Should Consider Investing:

REXX is suitable for investors:

• Seeking to profit from market volatility: The ETF's long VIX futures strategy aims to benefit from increases in volatility, making it suitable for investors seeking to hedge against market downturns.
• Understanding of volatility strategies: Investing in REXX requires a strong understanding of volatility dynamics and the complexities of VIX futures.
• High-risk tolerance: REXX's price can fluctuate significantly, making it suitable for investors with a high-risk tolerance.

Fundamental Rating Based on AI:

Based on an AI-powered analysis of various factors, including financial health, market position, and future prospects, REXX receives a fundamental rating of 7 out of 10. This rating reflects its unique strategy, active management, and potential for growth. However, investors should be aware of the inherent risks associated with volatility exposure and carefully evaluate their risk tolerance before investing.

Resources and Disclaimers:

• VelocityShares Website: https://www.velocishares.com/
• ETF Database: https://etfdb.com/etf/REXX/
• Disclaimer: This analysis is provided for informational purposes only and should not be considered financial advice. Investing in any ETF involves risks, and investors should conduct thorough research and due diligence before making any investment decisions.