FolioBeyond Rising Rates ETF (RISR)

Overview

The FolioBeyond Rising Rates ETF (RISR) aims to deliver positive returns in rising interest rate environments by investing in a portfolio of fixed-income instruments and derivatives designed to benefit from increasing yields.

Reputation and Reliability

FolioBeyond is a smaller ETF issuer, and its reputation and reliability depend on its track record of managing specialized strategies.

Management Expertise

The management team's expertise is focused on fixed income and macroeconomic analysis, with experience in developing strategies that can navigate interest rate volatility.

Goal

The primary investment goal of RISR is to generate positive returns during periods of rising interest rates.

Investment Approach and Strategy

Strategy: RISR employs an actively managed approach, using derivatives like interest rate swaps, Treasury futures, and other fixed-income instruments to capitalize on rising interest rates.

Composition The ETF holds a combination of fixed-income securities and derivative instruments, with a focus on those expected to benefit from increasing interest rates. The specific holdings may vary based on the managersu2019 outlook.

Market Share: RISR's market share in the rising rates ETF sector is relatively small, as it is a niche strategy.

Total Net Assets (AUM): 11180000

Key Competitors

• ProShares Short 20+ Year Treasury (TBF)
• ProShares UltraShort 20+ Year Treasury (TBT)
• Direxion Daily 20+ Yr Trsy Bear 3X ETF (TMV)

Competitive Landscape

The competitive landscape consists of several ETFs that seek to profit from rising interest rates, primarily through shorting Treasury bonds or using leveraged strategies. RISR distinguishes itself through active management and a potentially broader range of instruments compared to more purely short Treasury strategies. The advantage of RISR is its active management approach allows it to adjust positions based on changing market conditions. A disadvantage is that the fund's expense ratio may be higher than passively managed competitors.

Historical Performance: Historical performance data should be reviewed to understand how RISR has performed during various interest rate cycles. The historical data is dependent on the time period being looked at.

Benchmark Comparison: There is no direct benchmark index for RISR, making it crucial to compare it against relevant interest rate benchmarks like the 10-year Treasury yield.

Expense Ratio: 0.74

Average Trading Volume

RISR's average trading volume is relatively low, indicating limited liquidity.

Bid-Ask Spread

The bid-ask spread for RISR can be wider than more liquid ETFs, potentially increasing the cost of trading.

Market Environment Factors

RISR's performance is strongly influenced by macroeconomic factors such as inflation, Federal Reserve policy, and economic growth, all of which affect interest rates.

Growth Trajectory

The growth trajectory of RISR depends on investors' expectations regarding interest rate movements and their desire for strategies that can potentially benefit from rising rates. Changes to the strategy may include adjustments to the portfolio's composition based on the fund manager's outlook on interest rates.

Competitive Edge

RISR's competitive edge lies in its active management approach, allowing it to adapt its strategy based on evolving interest rate expectations. It can use a variety of fixed-income instruments and derivatives to generate positive returns in a rising rate environment. The fund's flexibility to use different asset classes to profit from rising interest rates gives it another key advantage. This strategy can give it an edge over passively managed funds.

Volatility

RISR's volatility can be high, especially during periods of rapid interest rate changes, due to its use of derivatives and active management.

Market Risk

The main market risk is that interest rates may not rise as expected, leading to underperformance or losses. Other risks include counterparty risk associated with derivatives and the complexity of the fund's strategy.

Ideal Investor Profile

The ideal investor profile for RISR includes those who anticipate rising interest rates and seek a potentially hedged or opportunistic investment to benefit from such a scenario.

Market Risk

RISR is best suited for investors with a higher risk tolerance who understand the complexities of fixed-income derivatives and active management. It is more suitable for active traders or those who can closely monitor interest rate movements.

The FolioBeyond Rising Rates ETF (RISR) is an actively managed fund designed to generate positive returns in a rising interest rate environment. It uses a combination of fixed-income instruments and derivatives, making it a complex and potentially volatile investment. Its success depends on the accuracy of its managers' interest rate forecasts and their ability to effectively deploy the fund's strategy. RISR is best suited for sophisticated investors who understand the risks and potential rewards associated with actively managed fixed-income strategies and have a clear view on the direction of interest rates. The fund's relatively small AUM and trading volume may impact liquidity and transaction costs.

Data Sources:

• ETF.com
• Yahoo Finance
• Company Filings

Disclaimers:

This analysis is for informational purposes only and does not constitute financial advice. Investment decisions should be based on individual circumstances and consultation with a financial advisor. Data may be delayed.