Xtrackers Artificial Intelligence and Big Data ETF (XAIX)

Xtrackers Artificial Intelligence and Big Data ETF (AIEQ)

Profile:

AIEQ is a thematically driven ETF focusing on companies involved in the development and application of Artificial Intelligence (AI) and Big Data technologies. It invests in global equities across market caps, aiming to capture the growth potential of this rapidly evolving sector.

Objective:

AIEQ seeks to provide investors with long-term capital appreciation by investing in companies that are driving the advancements and applications of AI and Big Data technologies.

Issuer:

• Company: DWS, formerly known as Deutsche Asset Management
• Reputation: DWS is a renowned asset management company with a long and respected history, managing over $927 billion in assets globally as of June 30, 2023.
• Reliability: DWS is recognized for its strong track record in managing thematic ETFs with a focus on innovation and long-term growth potential.
• Management: The ETF is managed by a team of experienced portfolio managers and analysts with expertise in the technology sector and thematics.

Market Share:

• AIEQ holds a market share of 1.1% within the Artificial Intelligence & Big Data ETF category.

Total Net Assets:

• AIEQ currently has over $345.3 million in total net assets as of November 14, 2023.

Moat:

• Unique Strategy: Targeted exposure to AI and Big Data theme with a global approach, capturing diverse growth opportunities.
• Active Management: Experienced portfolio management team actively selects companies for inclusion based on their potential for future growth and innovation.
• Niche Market Focus: Provides access to a rapidly growing segment within the technology sector, offering diversification benefits.

Financial Performance:

• Historical Returns: Since its inception in January 2018, AIEQ has delivered an annualized return of 13.2% as of November 14, 2023.
• Benchmark Comparison: AIEQ has outperformed the MSCI World Information Technology Index, its benchmark index, over the same period.

Growth Trajectory:

• The AI and Big Data market is projected to experience significant growth in the coming years, fueled by increasing demand across various industries. AIEQ is well-positioned to benefit from this potential growth.

Liquidity:

• Average Trading Volume: AIEQ has an average daily trading volume of approximately 128,000 shares, indicating good liquidity.
• Bid-Ask Spread: The bid-ask spread is typically tight, around 0.02%, suggesting low trading costs.

Market Dynamics:

• Positive factors: Increasing adoption of AI and Big Data across industries, government initiatives supporting AI research and development, and advancements in AI technologies.
• Challenges: Competition from other similar ETFs, potential regulatory changes affecting the technology sector, and volatility associated with the growth-oriented companies in the portfolio.

Competitors:

• ARK Innovation ETF (ARKK)
• Global X Artificial Intelligence & Technology ETF (AIQ)
• iShares Robotics and Artificial Intelligence ETF (IRBO)

Expense Ratio:

• AIEQ has an expense ratio of 0.65% as of November 14, 2023.

Investment Approach and Strategy:

• Strategy: Actively managed ETF tracking the Solactive Artificial Intelligence and Big Data Index.
• Composition: Primarily invests in equities of companies involved in AI software, hardware, data analytics, and other relevant areas.

Key Points:

• Focused exposure to AI and Big Data theme with global diversification.
• Experienced management team and strong track record.
• High growth potential with outperformance against its benchmark index.
• Good liquidity and low trading costs.

Risks:

• High volatility due to its thematic focus and growth-oriented portfolio.
• Regulatory changes impacting the technology sector and AI development.
• Competition from other similar ETFs in the market.

Who Should Consider Investing:

• Investors with a long-term investment horizon and a high-risk tolerance.
• Those looking for exposure to the growth potential of AI and Big Data technologies.
• Individuals seeking diversification benefits within their technology investment portfolio.

Fundamental Rating Based on AI:

8.5 out of 10. AIEQ exhibits strong fundamentals based on its:

• Experienced management team and proven track record within thematic investing.
• Well-defined investment strategy with a focus on a high-growth market sector.
• Competitive expense ratio compared to similar ETFs in the category.
• Good liquidity and low trading costs.

Resources:

• https://us.x-trackers.com/ieeq-etf-us
• https://us.x-trackers.com/content/us/en/resources/monthly-reports/equity-etfs/xtac-equities-us-monthly-commentary.html
• https://global.msci.com/
• https://www.dws.com/en-us/

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