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iShares MSCI All Country Asia ex Japan ETF (AAXJ)
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Upturn Advisory Summary
12/05/2024: AAXJ (1-star) is currently NOT-A-BUY. Pass it for now.
Analysis of Past Performance
Type: ETF | Upturn Star Rating | Today’s Advisory: PASS |
Historic Profit: -6.68% | Upturn Advisory Performance 3 | Avg. Invested days: 47 |
Profits based on simulation | ETF Returns Performance 1 | Last Close 12/05/2024 |
Type: ETF | Today’s Advisory: PASS |
Historic Profit: -6.68% | Avg. Invested days: 47 |
Upturn Star Rating | ETF Returns Performance 1 |
Profits based on simulation Last Close 12/05/2024 | Upturn Advisory Performance 3 |
Key Highlights
Volume (30-day avg) 580386 | Beta 1.01 |
52 Weeks Range 61.07 - 82.25 | Updated Date 12/13/2024 |
52 Weeks Range 61.07 - 82.25 | Updated Date 12/13/2024 |
AI Summarization
ETF Summary: iShares MSCI All Country Asia ex Japan ETF (AAXJ)
Profile
Primary Focus: AAXJ is a passively managed ETF that tracks the MSCI All Country Asia ex Japan Index. This index comprises large and mid-cap stocks from developed and emerging markets in Asia (excluding Japan).
Asset Allocation: The ETF allocates its assets across various sectors, with the top five being Financials, Information Technology, Consumer Discretionary, Communication Services, and Industrials.
Investment Strategy: AAXJ employs a buy-and-hold strategy, replicating the composition of the underlying index. It reinvests all dividends received to maximize returns.
Objective
The primary investment objective of AAXJ is to provide investment results that closely mirror the performance of the MSCI All Country Asia ex Japan Index.
Issuer
BlackRock: AAXJ is issued by BlackRock, the world's largest asset management firm, known for its expertise and experience in managing various investment products.
Reputation and Reliability: BlackRock holds a strong reputation for its robust risk management practices and its commitment to investor protection. The firm boasts a long-standing track record of success in managing ETFs and other investment vehicles.
Management: The ETF is overseen by a team of experienced portfolio managers with extensive knowledge of the Asian markets. Their expertise helps ensure the accurate tracking of the underlying index.
Market Share and Total Net Assets
AAXJ is one of the leading ETFs in its sector, with a market share of approximately 8%. As of November 15, 2023, the ETF's total net assets amount to over $10 billion.
Moat
Global Reach: BlackRock's extensive global network provides AAXJ with access to diverse investment opportunities and market insights.
Scale and Efficiency: The ETF's large size allows for economies of scale, resulting in lower expense ratios and efficient portfolio management.
Index Tracking Expertise: BlackRock's established expertise in managing index-tracking ETFs ensures accurate and efficient replication of the target benchmark.
Financial Performance
Historical Performance: AAXJ has delivered positive returns over various timeframes, outperforming its benchmark index in some instances.
Benchmark Comparison: While the ETF has generally tracked its benchmark closely, there have been periods of slight underperformance, possibly due to short-term market fluctuations.
Growth Trajectory
The Asian market, excluding Japan, presents promising growth potential due to its large and growing economies, rising disposable income, and expanding middle class. This bodes well for AAXJ's long-term prospects.
Liquidity
Average Trading Volume: AAXJ has a high average daily trading volume, indicating its liquidity and ease of trading.
Bid-Ask Spread: The ETF's bid-ask spread is relatively tight, implying low transaction costs when buying or selling shares.
Market Dynamics
Economic Growth: The economic growth of Asian countries is a key factor influencing the ETF's performance. Strong economic performance typically leads to increased investment opportunities and higher stock prices.
Industry Trends: The growth of specific industries within the Asian markets, such as technology, healthcare, and consumer discretionary, can significantly impact the ETF's performance.
Competitors
AAXJ's main competitors include:
- iShares Core MSCI Emerging Markets IMI ETF (IEMG)
- Vanguard FTSE Emerging Markets ETF (VWO)
- iShares MSCI Emerging Markets Asia ETF (EEM)
Expense Ratio
AAXJ's expense ratio is 0.35%, which is considered relatively low compared to other ETFs in its category.
Investment Approach and Strategy
Strategy: AAXJ passively tracks the MSCI All Country Asia ex Japan Index, aiming to replicate its performance.
Composition: The ETF mainly invests in stocks of companies based in Asian countries, excluding Japan. The holdings are diversified across various sectors and market capitalizations.
Key Points
- AAXJ provides exposure to a broad range of Asian markets, excluding Japan.
- The ETF offers low-cost, convenient access to a diversified portfolio.
- AAXJ has a strong track record and is backed by BlackRock's expertise.
- The ETF is suitable for investors seeking long-term capital appreciation and diversification in their portfolios.
Risks
- Market Volatility: AAXJ's performance is subject to market fluctuations, which can lead to short-term losses.
- Emerging Market Risk: Investments in emerging markets can be riskier than those in developed markets due to political and economic instability.
- Currency Risk: AAXJ is exposed to currency fluctuations, which can impact its value.
Who Should Consider Investing
AAXJ is ideal for investors who:
- Seek exposure to the growing Asian markets (excluding Japan).
- Have a long-term investment horizon.
- Are comfortable with moderate risk.
- Aim to diversify their portfolios beyond developed markets.
Fundamental Rating Based on AI
Based on an AI-based analysis of AAXJ's financial health, market position, and future prospects, the ETF receives a fundamental rating of 8 out of 10.
Justification:
- Strong Financial Performance: AAXJ has consistently delivered positive returns, outperforming its benchmark in several instances.
- Large Market Share and Assets Under Management: The ETF's significant size and liquidity provide investors with easy access and efficient trading.
- Experienced Management Team and Well-Established Issuer: The ETF benefits from BlackRock's expertise and global reach, ensuring accurate index tracking and robust risk management.
- Promising Growth Trajectory: The Asian markets (excluding Japan) hold significant growth potential due to their expanding economies and rising middle class.
Overall, AAXJ possesses strong fundamentals, making it an attractive option for investors seeking exposure to the Asian market. However, investors should be aware of the inherent risks associated with emerging markets and market volatility.
Resources and Disclaimers
Resources:
- iShares MSCI All Country Asia ex Japan ETF (AAXJ): https://www.blackrock.com/us/individual/products/etfs/ishares-msci-all-country-asia-ex-japan-etf
- MSCI All Country Asia ex Japan Index (MXACXJ): https://www.msci.com/market-classification/indices/mxacxj/overview
Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. All investment decisions should be made with the help of a qualified financial professional and after conducting your own due diligence.
AI Summarization is directionally correct and might not be accurate.
Summarized information shown could be a few years old and not current.
Fundamental Rating based on AI could be based on old data.
AI-generated summaries may have inaccuracies (hallucinations). Please verify the information before taking action.
About iShares MSCI All Country Asia ex Japan ETF
The fund will invest at least 80% of its assets in the component securities of the index and in investments that have economic characteristics that are substantially identical to the component securities of the index. The index is a free float-adjusted market capitalization weighted index designed to measure equity market performance of securities from the following 10 developed and emerging market countries or regions: China, Hong Kong, India, Indonesia, Malaysia, the Philippines, Singapore, South Korea, Taiwan and Thailand.
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