AdvisorShares Dorsey Wright ADR ETF (AADR)

Overview

The AdvisorShares Dorsey Wright ADR ETF (AADR) seeks long-term capital appreciation by investing in American Depositary Receipts (ADRs) of foreign companies that Dorsey Wright & Associates (DWA) believes demonstrate superior relative strength characteristics.

Reputation and Reliability

AdvisorShares is known for its actively managed ETFs, often focusing on specific strategies and thematic investments. Their reliability is tied to the performance and execution of their investment strategies.

Management Expertise

Dorsey Wright & Associates (DWA) is a sub-advisor known for its expertise in relative strength investing, a momentum-based strategy.

Goal

To provide long-term capital appreciation.

Investment Approach and Strategy

Strategy: AADR employs a relative strength strategy, selecting ADRs of foreign companies based on their price performance relative to other equities.

Composition The ETF holds a portfolio of ADRs of foreign companies across various sectors and countries, selected based on the relative strength methodology.

Market Share: AADR holds a small market share within the broader international equity ETF landscape.

Total Net Assets (AUM): 47850000

Key Competitors

• VEA
• IXUS
• ACWX
• SPDW
• GWX

Competitive Landscape

The international equity ETF market is highly competitive, dominated by large, low-cost index trackers. AADR's active management and relative strength focus differentiate it, potentially offering higher returns but also greater risk and higher fees compared to passively managed competitors. AADR's disadvantage is its higher expense ratio and smaller AUM compared to the major ETFs. Its advantage lies in its potential for outperformance through active selection.

Historical Performance: Historical performance data is readily available from financial data providers. Past performance does not guarantee future results.

Benchmark Comparison: The ETF's performance can be compared to broad international equity indices (e.g., MSCI EAFE) or relative strength-focused benchmarks.

Expense Ratio: 0.6

Average Trading Volume

AADR's average trading volume indicates moderate liquidity.

Bid-Ask Spread

The bid-ask spread reflects the cost of trading the ETF and is typically wider than highly liquid ETFs.

Market Environment Factors

Global economic growth, currency fluctuations, and geopolitical events can influence the performance of AADR's holdings.

Growth Trajectory

AADR's growth trajectory depends on the success of its relative strength strategy in identifying outperforming ADRs and attracting investor capital.

Competitive Edge

AADR's competitive advantage stems from its active management and application of Dorsey Wright's relative strength methodology to a portfolio of ADRs. This strategy aims to identify and invest in foreign companies with strong price momentum. The ETF differentiates itself from passive international equity ETFs by focusing on relative strength, potentially leading to higher returns in certain market environments. However, this active approach also introduces the risk of underperformance compared to benchmark indices. The ETF's active management strategy can offer diversification benefits if the stock-picking decisions result in a portfolio that is different from traditional passive international equity indices.

Volatility

AADR's volatility can be influenced by the volatility of the underlying ADRs and the effectiveness of the relative strength strategy.

Market Risk

Market risk includes the risk of declines in the overall international equity market, as well as currency risk associated with foreign investments.

Ideal Investor Profile

AADR is suitable for investors seeking international equity exposure with potential for higher returns through active management and a relative strength strategy. It's suited for investors with a higher risk tolerance and a longer-term investment horizon.

Market Risk

AADR may be more suitable for active traders or investors who are willing to pay higher fees for the potential of outperformance, rather than passive index followers.

The AdvisorShares Dorsey Wright ADR ETF is an actively managed fund that invests in ADRs of foreign companies exhibiting strong relative strength. Its aim is to provide long-term capital appreciation, differentiating itself from passive international equity ETFs with its active investment strategy. While the relative strength strategy offers the potential for outperformance, it also carries higher risk and fees. Investors should assess their risk tolerance and investment goals to determine if AADR aligns with their portfolio strategy. The ETF is best suited for investors with a higher risk tolerance and a longer-term investment horizon.

Data Sources:

• AdvisorShares website
• ETF.com
• Morningstar
• YCharts

Disclaimers:

The information provided is for informational purposes only and does not constitute financial advice. Investment decisions should be based on individual circumstances and consultation with a qualified financial advisor. Past performance is not indicative of future results. Market share data is estimated based on available information and may not be precise.