Inspire Tactical Balanced ESG ETF (RISN)

Overview

The Inspire Tactical Balanced ESG ETF (IGAS) is an actively managed ETF that seeks to provide both growth and income while adhering to Environmental, Social, and Governance (ESG) principles. It invests in a diversified portfolio of equity and fixed-income securities, with a tactical allocation strategy that adjusts based on market conditions and ESG scoring.

Reputation and Reliability

Inspire Investing is a firm focused on faith-based and ESG investing. While newer compared to some legacy asset managers, they have established a reputation for their commitment to specific ethical and ESG criteria in their product offerings.

Management Expertise

The ETF is managed by Inspire Investing, a team with a stated focus on ESG principles and active management. Specific details on the individual portfolio managers' experience are typically found in the fund's prospectus.

Goal

To achieve long-term capital appreciation and current income by investing in a balanced portfolio of ESG-compliant equity and fixed-income securities, with tactical adjustments to asset allocation.

Investment Approach and Strategy

Strategy: This ETF employs a tactical asset allocation strategy, meaning it actively adjusts its holdings in equities and fixed income based on market outlook and ESG considerations, rather than passively tracking an index.

Composition The ETF holds a mix of U.S. and international equities, as well as fixed-income securities (bonds). The specific allocation between these asset classes is dynamic and managed tactically.

Market Share: Information on specific market share for niche ESG ETFs like IGAS is not readily available in a standardized format. It operates within the broader balanced ETF and ESG ETF segments.

Total Net Assets (AUM): 31061385

Key Competitors

• Vanguard Balanced ETF (VBINX)
• iShares Core Moderate Allocation ETF (AOMM)
• Schwab U.S. Aggregate Bond ETF (SCHZ)

Competitive Landscape

The balanced ETF and ESG ETF markets are highly competitive, with large, established players offering broad diversification and lower fees. IGAS differentiates itself through its specific ESG screening and tactical active management. Its smaller AUM compared to giants like Vanguard or iShares means it has less liquidity and potentially higher tracking error, but its niche focus on ESG and tactical shifts could appeal to a specific investor base.

Historical Performance: As of December 31, 2023, the ETF's year-to-date return was 8.48%. Prior year performance data can vary, and investors should consult the latest prospectus for up-to-date figures. The fund's tactical nature can lead to performance that deviates significantly from passive benchmarks.

Benchmark Comparison: The ETF does not track a specific benchmark index but is managed tactically. Its performance should be evaluated against a blended benchmark representing its target asset allocation, or against its stated investment objective.

Expense Ratio: 0.59

Average Trading Volume

The average daily trading volume for the Inspire Tactical Balanced ESG ETF is generally low, indicating potentially lower liquidity.

Bid-Ask Spread

Due to its lower trading volume, the bid-ask spread for the Inspire Tactical Balanced ESG ETF can be wider than for more heavily traded ETFs, increasing trading costs.

Market Environment Factors

The ETF is influenced by broader economic trends such as interest rate movements, inflation, and corporate earnings. Its ESG focus also means it's sensitive to policy changes and investor sentiment regarding sustainability and ethical investing.

Growth Trajectory

The growth of the ESG investing space generally presents a positive trend. IGAS's specific growth trajectory will depend on its ability to attract assets through its unique ESG approach and tactical management, and adapt to evolving market conditions and ESG preferences.

Competitive Edge

The Inspire Tactical Balanced ESG ETF's primary competitive edge lies in its dual focus: deep ESG integration and tactical asset allocation. It offers investors a curated portfolio that aligns with specific ethical values while aiming to adapt to changing market dynamics. This active approach, combined with its specialized ESG screening, aims to provide a distinct alternative to passive ESG or traditional balanced funds.

Volatility

As a balanced ETF with equity exposure, IGAS is subject to market volatility. Its tactical allocation strategy can sometimes amplify short-term swings depending on the market environment and the success of its tactical shifts.

Market Risk

The ETF is exposed to risks inherent in its underlying assets: equity market risk (downturns in stock prices), interest rate risk (for its fixed-income holdings), credit risk (for bonds), and currency risk (for international holdings). Its ESG focus may also lead to sector concentration or exclusion, which could impact performance if those sectors underperform.

Ideal Investor Profile

The ideal investor for the Inspire Tactical Balanced ESG ETF is one who is committed to ESG principles, seeks a balanced exposure to growth and income, and believes in an actively managed, tactical approach to asset allocation. They should also be comfortable with a potentially lower liquidity profile and a higher expense ratio compared to passive ETFs.

Market Risk

This ETF is likely best suited for long-term investors who want their investments to align with their values and are willing to accept active management's potential for both outperformance and underperformance relative to benchmarks. It is less suitable for short-term traders due to its lower liquidity.

The Inspire Tactical Balanced ESG ETF (IGAS) offers a unique blend of ESG principles and tactical asset allocation. It aims to provide growth and income by actively managing a diversified portfolio of equities and bonds screened for ethical considerations. While its niche focus and active strategy appeal to value-driven investors, its lower AUM and trading volume suggest considerations around liquidity and potentially higher costs. Investors should carefully review its specific ESG criteria and tactical strategy against their investment goals.

Data Sources:

• Inspire Investing Official Website
• Financial Data Providers (e.g., Morningstar, ETF Database)

Disclaimers:

This information is for educational purposes only and does not constitute investment advice. Performance data is subject to change. Investors should consult with a qualified financial advisor before making any investment decisions. Market share and competitor data are estimates and may vary by source.