GraniteShares 1x Short AMD Daily ETF (AMDS)

Overview

The GraniteShares 1x Short AMD Daily ETF (HDGE) is designed to provide the inverse (-1x) of the daily performance of Advanced Micro Devices (AMD) stock. It offers a way for investors to potentially profit from a decline in AMD's stock price or to hedge against existing long positions in AMD. It targets the semiconductor sector and uses a derivatives-based strategy to achieve its inverse exposure.

Reputation and Reliability

GraniteShares is a relatively new ETF issuer, but is focused on providing leveraged and inverse products. Their reputation is building, but they have less historical data than established issuers.

Management Expertise

The management team specializes in structured products and derivatives, necessary for managing leveraged and inverse ETFs.

Goal

The primary investment goal is to deliver daily investment results that correspond to the inverse (-1x) of the daily performance of AMD stock.

Investment Approach and Strategy

Strategy: The ETF uses a short-term strategy to provide inverse exposure to AMD's daily price movements. It does not aim to replicate long-term inverse performance.

Composition The ETF primarily holds financial instruments like swap agreements that are designed to deliver the inverse daily performance of AMD. It typically does not hold AMD shares directly.

Market Share: HDGE's market share is relatively small due to the niche nature of single-stock inverse ETFs.

Total Net Assets (AUM): 23613050

Key Competitors

• Direxion Daily Semiconductor Bear 3x Shares ETF (SOXS)

Competitive Landscape

The competitive landscape includes leveraged and inverse ETFs that target the semiconductor sector or specific companies within the sector. HDGE offers a direct, unleveraged inverse exposure to AMD, which may appeal to investors seeking less aggressive strategies. However, its limited assets and trading volume can be a disadvantage compared to larger, more liquid competitors.

Historical Performance: Historical performance data is highly dependent on AMD's price movements. Given its inverse nature, it will generally perform inversely to AMD's daily changes. Long-term performance will vary significantly and is subject to compounding effects.

Benchmark Comparison: There is no specific benchmark index, but the performance can be compared to the inverse daily returns of AMD's stock. It should be noted that compounding can cause the ETF's returns to deviate from the simple inverse over longer periods.

Expense Ratio: 0.0115

Average Trading Volume

The average daily trading volume varies, but is generally moderate, which could impact order execution for larger trades.

Bid-Ask Spread

The bid-ask spread can vary and might be wider than more liquid ETFs, potentially increasing trading costs.

Market Environment Factors

AMD's stock price is influenced by factors such as semiconductor industry trends, competition, technological innovation, and overall market sentiment. Economic indicators and global supply chain issues also play a role.

Growth Trajectory

Growth trends for the ETF are directly correlated with the anticipated or actual decline of AMD's stock price. Changes to strategy and holdings are unlikely due to the ETF's defined objective.

Competitive Edge

HDGE's competitive advantage lies in its targeted, unleveraged inverse exposure to AMD, allowing investors to directly bet against AMD without using margin or complex options strategies. The fund's focused approach may appeal to investors who have a specific negative outlook on AMD and are seeking a simple, direct way to express their view. However, due to the fund's inverse and leveraged status, this fund is not appropriate for all investors, especially those with a low risk tolerance or a short-term horizon.

Volatility

The ETF experiences high volatility due to the leverage and inverse exposure. Daily rebalancing can lead to significant deviations from the simple inverse of AMD's performance over longer time periods.

Market Risk

The ETF is exposed to market risk related to AMD and the semiconductor sector, as well as risks associated with derivatives and inverse ETFs.

Ideal Investor Profile

The ideal investor is an experienced trader with a short-term outlook who understands the risks of leveraged and inverse ETFs and has a bearish view on AMD.

Market Risk

The ETF is best suited for active traders who use it for short-term hedging or speculation, not for long-term investment strategies.

GraniteShares 1x Short AMD Daily ETF (HDGE) provides an inverse exposure to the daily performance of AMD, designed for short-term trading strategies. The ETF's performance is highly dependent on AMD's stock price fluctuations, making it a volatile and risky investment. It is suitable for experienced traders seeking to profit from a potential decline in AMD's stock, or to hedge against current long positions. Investors should be aware of the compounding effects and daily rebalancing that can cause deviations from simple inverse performance over time.

Data Sources:

• GraniteShares Website
• ETF.com
• Morningstar

Disclaimers:

The information provided is for informational purposes only and should not be considered financial advice. Past performance is not indicative of future results. Investing in ETFs involves risk, including the potential loss of principal.