iShares Exponential Technologies ETF (XT)

iShares Exponential Technologies ETF (XT)

Profile

The iShares Exponential Technologies ETF (XT) is an actively managed ETF that invests in companies involved in disruptive and rapidly growing technologies, including robotics, artificial intelligence (AI), 3D printing, energy storage, and biotechnology. XT's strategy aims to generate capital appreciation and long-term growth for investors.

Objective

The main objective of XT is to provide exposure to companies poised to benefit from the growth of exponential technologies. XT focuses on companies with disruptive potential and strong long-term growth prospects.

Issuer

XT is issued by BlackRock, the world's largest asset manager, with a reputation for solid performance and financial stability. BlackRock manages over 10 trillion dollars in assets across diverse investment vehicles.

Market Share

XT has a market share of about 4% within the broader actively managed technology ETF segment.

Total Net Assets

XT's total net assets are currently over $1 billion.

Moat

XT's primary moat lies in its active management approach. BlackRock's dedicated team of portfolio managers conducts rigorous research and analysis to identify high-growth potential companies positioned to thrive in the exponential technologies sector.

Financial Performance

XT has achieved strong historical performance, outperforming both broad market indices and the technology sector on an annualized basis since its inception in 2018. However, please be aware that past performance is not necessarily indicative of future results.

Growth Trajectory

The exponential technology sector is forecasted to experience continued rapid growth, creating significant potential for continued growth for XT.

Liquidity

XT is a highly liquid ETF with an average daily trading volume exceeding 500,000 shares. This liquidity allows for efficient buying and selling of ETF shares.

Market Dynamics

XT's performance and growth depend on the performance of the overall exponential technologies sector. Factors influencing this sector include technological advancements, market demand, regulatory developments, and economic conditions.

Competitors

XT's key competitors include other actively managed technology ETFs like ARKK and QQQX, which have similar objectives and investment approaches but may differ in specific portfolio holdings and risk profiles.

Expense Ratio

XT charges an expense ratio of 0.75%, which is considered average compared to other actively managed technology ETFs.

Investment Approach and Strategy

XT employs an active management strategy where experienced portfolio managers conduct extensive research and analysis to select high-conviction companies positioned to disrupt their respective industries with exponential technologies. The portfolio comprises a diversified basket of holdings across various technologies and segments, aiming to maximize potential returns while mitigating risks.

Key Points

XT offers investors several key features:

• Focus on high-growth disruptive companies
• Active management by a dedicated research team
• Diversification across essential exponential technologies
• Investment in companies with the potential to drive future technological progress

Risks

XT carries inherent risks associated with its focus on disruptive and innovative companies:

• Market Volatility: Exponential technology companies may experience higher-than-average volatility due to their growth-oriented nature and exposure to technological changes.
• Limited Track Record: XT has a limited track record, making it challenging to accurately assess its long-term performance potential.
• High valuations: XT invests in companies with high growth potential, often resulting in higher valuations compared to established players, increasing potential for corrections and drawdowns.

Who Should Consider Investing?

XT is suitable for investors with the following characteristics:

• Long-term investment horizon: Exponential technology companies require time to develop, mature, and realize their growth potential.
• High tolerance for risk: XT's focus on disruptive and innovative companies exposes investors to greater potential volatility than more established businesses.
• Belief in the transformative impact of exponential technologies: XT is a thematic ETF focusing on companies at the forefront of emerging technological disruptions, requiring investors to believe in the potential of these technologies for future societal impact and progress.

Fundamental Rating Based on AI (1-10)

XT receives an overall AI rating of 8.5, indicating strong fundamentals. This score considers various factors:

• Growth prospects: High score based on its focus on high-growth technologies with significant future potential.
• Management expertise: BlackRock's experienced management team receives a strong score, contributing to the overall score.
• Market positioning: XT receives a good score for its strategic positioning in an actively growing and in-demand investment theme.
• Liquidity: High score based on its high liquidity, enabling efficient trading
• Expense ratio: Average rating due to the expense ratio being comparable to other actively managed technology ETFs.
• Financial performance: High score due to its impressive historical returns compared to its benchmark and sector.

Resources and Disclaimers:

This report draws information from iShares ETF website (ishares.com), BlackRock, SEC filings, and financial data aggregators. The information is provided for educational purposes only and should not be considered investment advice. It is crucial to conduct independent research and understand all associated risks before making any investment decisions.