Timothy Plan US Small Cap Core ETF (TPSC)

Overview

The Timothy Plan US Small Cap Core ETF (TEMDX) focuses on investing in a diversified portfolio of U.S. small-capitalization companies. It aims to achieve growth by selecting companies with strong fundamentals and a commitment to ethical investing principles, often aligning with Christian values. The ETF employs a core strategy, meaning it seeks to capture the broad performance of the small-cap segment while incorporating its specific ethical screening.

Reputation and Reliability

Timothy Plan is known for its focus on faith-based and socially responsible investing, with a history of offering ETFs and mutual funds that adhere to specific ethical criteria. Their reputation is built on providing investment options for individuals and institutions seeking to align their financial portfolios with their values.

Management Expertise

Information on the specific management team's expertise for TEMDX is typically found in the fund's prospectus. Timothy Plan generally emphasizes a disciplined investment process rooted in their ethical screening and fundamental analysis.

Goal

The primary investment goal of the Timothy Plan US Small Cap Core ETF is to provide long-term capital appreciation by investing in U.S. small-capitalization companies that meet its ethical and financial criteria.

Investment Approach and Strategy

Strategy: The ETF aims to outperform its benchmark by selecting a diversified portfolio of small-cap stocks. It does not aim to track a specific index but rather to actively select securities that align with its investment philosophy, which includes ethical screening.

Composition The ETF primarily holds U.S. common stocks of companies with small market capitalizations. The selection process involves fundamental analysis and adherence to the Timothy Plan's ethical guidelines, which typically exclude companies involved in certain industries like alcohol, tobacco, gambling, and abortion.

Market Share: Specific, up-to-the-minute market share data for individual ETFs is highly dynamic and often proprietary. However, as a niche ETF focused on ethical investing within the small-cap segment, its market share is likely to be smaller compared to broad-market small-cap ETFs.

Total Net Assets (AUM): As of recent available data, the Total Net Assets (AUM) for Timothy Plan US Small Cap Core ETF (TEMDX) are approximately $17.7 million. (Note: This figure is subject to change and should be verified with real-time data sources).

Key Competitors

• iShares Russell 2000 ETF (IWM)
• Vanguard Small-Cap ETF (VB)
• iShares Core S&P Small-Cap ETF (IJR)

Competitive Landscape

The U.S. small-cap ETF market is highly competitive, dominated by large providers offering broad index-tracking products with low expense ratios. TEMDX competes by offering a niche focused on ethical investing, which appeals to a specific segment of investors. Its advantages lie in its values-based approach, which can be a significant differentiator for its target audience. However, its disadvantages may include a higher expense ratio and potentially less liquidity compared to its larger, more diversified competitors. The market is characterized by intense price competition and a race for assets through scale and low fees.

Historical Performance: Historical performance data for TEMDX varies. For instance, year-to-date returns, 1-year, 3-year, 5-year, and 10-year performance figures should be consulted from financial data providers. Generally, small-cap ETFs can exhibit higher volatility but also higher growth potential over the long term. Performance is influenced by market cycles and the fund's specific stock selections and ethical screening.

Benchmark Comparison: TEMDX's performance is typically compared against benchmarks like the Russell 2000 Index or the S&P SmallCap 600 Index. Its ability to outperform depends on its stock selection and adherence to its investment strategy relative to the broader small-cap market. Due to its ethical screening, it may deviate from pure index tracking.

Expense Ratio: The expense ratio for Timothy Plan US Small Cap Core ETF (TEMDX) is 1.46%. This includes management fees and other operating expenses.

Average Trading Volume

The average trading volume for TEMDX is relatively low, indicating it may not be as liquid as larger, more broadly held ETFs, which could affect ease of trading for large orders.

Bid-Ask Spread

Due to its lower trading volume, TEMDX may exhibit a wider bid-ask spread compared to more liquid ETFs, meaning the cost to buy and sell shares can be higher for traders.

Market Environment Factors

Factors such as interest rate policies, inflation, economic growth forecasts, and investor sentiment towards small-cap stocks significantly impact TEMDX. Sector-specific performance within the small-cap universe, regulatory changes, and global economic events also play a crucial role. The increasing demand for ESG (Environmental, Social, and Governance) or values-based investing could positively influence its growth.

Growth Trajectory

The growth trajectory of TEMDX is tied to the performance of the U.S. small-cap market and the increasing adoption of ethical investing principles. Changes in strategy might involve adjustments to ethical screens or a recalibration of its core small-cap investment approach based on market conditions and management's outlook. Holding adjustments would reflect ongoing stock selection and rebalancing to maintain diversification and adherence to its investment mandate.

Competitive Edge

TEMDX's primary competitive edge lies in its distinct commitment to faith-based, ethical investing. This niche focus attracts a specific investor base that prioritizes aligning their financial goals with their moral and religious values. By excluding certain industries, it offers a curated investment experience for those seeking to avoid specific types of companies. This differentiation, coupled with its focus on the small-cap growth potential, carves out a unique space in the ETF market.

Volatility

As a small-cap focused ETF, TEMDX is expected to exhibit higher historical volatility than large-cap or broad-market ETFs due to the inherent price swings of smaller companies. Its performance can be more sensitive to market downturns and economic uncertainties.

Market Risk

The specific risks associated with TEMDX's underlying assets include the general risks of equity investing, such as market downturns, economic recessions, and geopolitical events. Additionally, small-cap companies may be more susceptible to business failures, less diversified product lines, and limited access to capital compared to larger corporations. The ethical screening also introduces a risk of underperforming if excluded sectors outperform.

Ideal Investor Profile

The ideal investor for TEMDX is an individual or institution that prioritizes investing in companies aligned with Christian values and ethical principles. They should be seeking long-term capital appreciation from U.S. small-cap companies and are comfortable with the potential volatility associated with this asset class.

Market Risk

TEMDX is best suited for long-term investors who are committed to its ethical investing mandate. It is generally not ideal for active traders seeking frequent portfolio adjustments or investors who are solely focused on maximizing short-term returns without regard to ethical considerations.

The Timothy Plan US Small Cap Core ETF (TEMDX) is a niche ETF targeting U.S. small-capitalization companies with a strong emphasis on Christian ethical principles. It aims for long-term capital appreciation by selecting stocks that meet both financial and values-based criteria, excluding industries like alcohol and tobacco. While offering a unique proposition for ethically-minded investors, it faces competition from larger, broader small-cap ETFs and may experience higher volatility and a wider bid-ask spread due to its specialized focus and lower AUM.

Data Sources:

• Timothy Plan Official Website (Prospectus and Fund Information)
• Financial Data Providers (e.g., Morningstar, Yahoo Finance, Bloomberg)

Disclaimers:

The information provided is for informational purposes only and does not constitute financial advice. Investment decisions should be based on thorough research, consultation with a qualified financial advisor, and a review of the ETF's prospectus. Past performance is not indicative of future results. Data, including AUM and trading volumes, is subject to change.