DoubleLine Shiller CAPE US Equities ETF (DCPE)

Overview

The DoubleLine Shiller CAPE US Equities ETF (DSEU) aims to provide investment results that, before fees and expenses, correspond to the performance of the Shiller Barclays CAPEu00ae US Sector Index. The fund uses a rules-based approach to allocate its assets among the sectors of the U.S. equity market with the goal of achieving a higher risk-adjusted return than a traditional market-cap weighted index.

Reputation and Reliability

DoubleLine is a well-regarded investment management firm known for its expertise in fixed income and its partnership with Robert Shiller adds credibility to this equity ETF.

Management Expertise

DoubleLine boasts experienced portfolio managers and analysts who implement the ETF's investment strategy.

Goal

The fund seeks to track the Shiller Barclays CAPEu00ae US Sector Index, providing exposure to US equities with a sector allocation based on the cyclically adjusted price-to-earnings (CAPE) ratio.

Investment Approach and Strategy

Strategy: The fund tracks a specific index, the Shiller Barclays CAPEu00ae US Sector Index. It uses a sector rotation strategy based on the CAPE ratio, favoring sectors with lower CAPE ratios.

Composition The ETF holds U.S. equity securities, allocated across different sectors based on the Shiller Barclays CAPEu00ae US Sector Index methodology.

Market Share: DSEU has a relatively small market share compared to broad market ETFs and sector-specific ETFs with greater AUM.

Total Net Assets (AUM): 29840000

Key Competitors

• SPDR S&P 500 ETF Trust (SPY)
• Invesco QQQ Trust (QQQ)
• Vanguard Total Stock Market ETF (VTI)
• iShares Core S&P 500 ETF (IVV)

Competitive Landscape

The ETF industry is highly competitive with many large, established players. DSEU offers a unique sector rotation strategy based on the CAPE ratio, potentially providing downside protection and outperformance during specific market cycles. However, its smaller AUM and complex strategy may deter some investors compared to simpler, broad-market ETFs.

Historical Performance: Historical performance can be obtained through financial data providers, but must be caveated with the fact that past performance does not indicate future results.

Benchmark Comparison: The ETF is benchmarked against the Shiller Barclays CAPEu00ae US Sector Index, so a performance comparison would analyze the ETF's tracking error against this index.

Expense Ratio: 0.39

Average Trading Volume

The average trading volume for DSEU is relatively low, reflecting its smaller AUM and niche investment strategy.

Bid-Ask Spread

The bid-ask spread may be wider than more liquid ETFs, impacting trading costs.

Market Environment Factors

Economic conditions, interest rates, sector valuations, and investor sentiment influence DSEU's performance.

Growth Trajectory

Growth is dependent on the ETF's ability to attract assets and generate positive relative performance compared to its benchmark.

Competitive Edge

DSEU's competitive advantage lies in its unique sector rotation strategy based on the Shiller Barclays CAPEu00ae US Sector Index, developed by Robert Shiller. The CAPE ratio approach aims to identify undervalued sectors and avoid overvalued ones, which can enhance risk-adjusted returns. This rules-based approach offers a disciplined and systematic way to allocate assets. While not guaranteeing outperformance, the approach provides a differentiated investment strategy compared to traditional market-cap weighted ETFs.

Volatility

The ETF's volatility will depend on the volatility of the underlying equity sectors and the effectiveness of the CAPE ratio strategy.

Market Risk

The ETF is subject to market risk, which is the risk that the overall market declines, impacting the value of the ETF's holdings.

Ideal Investor Profile

The ideal investor for DSEU is one who understands and believes in the CAPE ratio valuation method and seeks a differentiated approach to sector allocation within the U.S. equity market. They also need to be comfortable with the ETF's relatively small size and potentially lower liquidity.

Market Risk

DSEU may be suitable for long-term investors who seek a strategic allocation to U.S. equities based on a value-oriented approach. It might also appeal to active traders looking to capitalize on sector rotations identified by the CAPE ratio.

DoubleLine Shiller CAPE US Equities ETF (DSEU) offers a unique sector rotation strategy based on the Shiller Barclays CAPEu00ae US Sector Index, aiming to enhance risk-adjusted returns by allocating to undervalued sectors. The ETF's small size, relatively low liquidity, and complex strategy may deter some investors. However, investors who understand and believe in the CAPE ratio approach and are seeking a differentiated allocation to U.S. equities might find DSEU appealing. Its performance is subject to market risk and the effectiveness of the sector rotation strategy. DSEU's innovative approach comes with potentially higher transaction costs compared to mainstream ETFs.

Data Sources:

• DoubleLine Funds website
• ETF.com
• Morningstar
• Bloomberg

Disclaimers:

The data and analysis provided are for informational purposes only and should not be considered investment advice. Past performance is not indicative of future results. Investment decisions should be made in consultation with a qualified financial advisor.