AllianzIM U.S. Large Cap Buffer10 Apr ETF (APRT)

Overview

The AllianzIM U.S. Large Cap Buffer10 Apr ETF (APRZ) seeks to provide investors with buffered exposure to the S&P 500, limiting downside risk up to a certain percentage over a one-year period, while still participating in potential gains. It primarily focuses on the large-cap sector of the U.S. equity market.

Reputation and Reliability

Allianz Investment Management is a well-established asset manager with a global presence and a strong reputation for risk management and innovative investment solutions.

Management Expertise

Allianz Investment Management has a team of experienced investment professionals specializing in structured and risk-managed equity strategies.

Goal

The primary investment goal of APRZ is to provide investors with a buffered return on the S&P 500 Index, protecting against the first 10% of losses, while still allowing participation in market upside, subject to a cap.

Investment Approach and Strategy

Strategy: APRZ employs a defined outcome strategy, utilizing options contracts to provide a buffer against market declines while participating in potential gains. It does not track the S&P 500 directly but seeks to replicate its performance with a defined buffer.

Composition APRZ primarily holds FLex Options referencing the S&P 500, along with a smaller allocation of cash or cash equivalents.

Market Share: APRZ's market share is growing within the defined outcome ETF segment, but is still smaller compared to more established funds.

Total Net Assets (AUM): 295978129

Key Competitors

• Innovator U.S. Equity Buffer ETF (BJUL)
• First Trust Cboe Vest U.S. Equity Buffer ETF - July (JULY)
• FT Cboe Vest U.S. Equity Deep Buffer ETF - July (DJUL)

Competitive Landscape

The defined outcome ETF market is becoming increasingly crowded, with numerous issuers offering similar buffered and capped strategies. APRZ competes on its buffer level, cap rate, issuer brand, and expense ratio. Its advantages are its buffer level and the backing of AllianzIM, but its disadvantages might include a higher expense ratio compared to competitors.

Historical Performance: Historical performance will vary depending on the specific period, but it's important to consider the capped upside and buffered downside in relation to the S&P 500.

Benchmark Comparison: APRZ's performance should be compared to the S&P 500, considering its buffer and cap. It will typically underperform in strongly rising markets due to the cap and outperform during moderate downturns due to the buffer.

Expense Ratio: 0.74

Average Trading Volume

The average trading volume of APRZ is moderate, which could affect trade execution costs for larger orders.

Bid-Ask Spread

The bid-ask spread can fluctuate depending on market conditions and trading volume, and is usually a few cents wide.

Market Environment Factors

Economic indicators such as interest rates, inflation, and GDP growth can affect the performance of APRZ, particularly through their impact on the S&P 500. Market volatility also plays a crucial role in the effectiveness of the buffer and the cap.

Growth Trajectory

APRZ's growth trajectory is dependent on investor demand for defined outcome strategies, its ability to attract assets, and its performance relative to competitors. Changes to the options strategy are unlikely, but the holdings will be adjusted to maintain the defined outcome characteristics.

Competitive Edge

APRZ's competitive advantages lie in its defined outcome strategy, which provides a buffer against market downturns, offering downside protection, and the established reputation of Allianz Investment Management. This offering can appeal to risk-averse investors. The experienced management team also contributes to the ETF's credibility. The defined term structure allows for predictable and consistent returns.

Volatility

APRZ's volatility is expected to be lower than the S&P 500 due to the downside buffer, but it may also miss out on significant gains due to the capped upside.

Market Risk

The primary market risk is the performance of the S&P 500. Additionally, the options strategy carries some risk related to counterparty risk and the accuracy of pricing models.

Ideal Investor Profile

The ideal investor for APRZ is a risk-averse investor seeking downside protection while still participating in some market upside, such as retirees or those nearing retirement.

Market Risk

APRZ is best for long-term investors seeking defined outcome strategies and downside protection, making it suitable for passive index followers with a focus on risk management.

The AllianzIM U.S. Large Cap Buffer10 Apr ETF (APRZ) offers a defined outcome strategy with a buffer against the first 10% of losses in the S&P 500 over a one-year period, while allowing for potential gains up to a cap. It is managed by Allianz Investment Management. This ETF is suitable for risk-averse investors looking for downside protection, but they should be aware of the potential for underperformance during strongly rising markets due to the cap and the expense ratio that they will be subjected to. APRZ can be a good portfolio diversification choice.

Data Sources:

• Allianz Investment Management Website
• ETF.com
• Morningstar

Disclaimers:

The information provided is for informational purposes only and should not be considered financial advice. Investors should conduct their own research and consult with a financial advisor before making any investment decisions. Market share data is an estimate based on available AUM information and may not be precise. Performance data is not predictive of future results.