ETFs & Markets with Todd Sohn: Thematic ETFs and the New S&P 500 Heavyweight

06/26/2024

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Strategas Asset Management ETF Strategist Todd Sohn breaks down one of the most popular investments: Thematic ETFs, as well as the new heavyweight in the S&P 500

Definitions:

“Weighted” is a description of adjustments to a figure to reflect different proportions or "weights" of components that make up that figure.

An exchange-traded fund (ETF) is a pooled investment security that can be bought and sold like an individual stock.

The S&P 500 is a stock market index tracking the stock performance of 500 of the largest companies listed on stock exchanges in the United States.

Equity ETFs invest in a basket of company stocks (also known as equities or shares). They are the most common type of ETFs.

Downside protection is when you use certain investment tactics to help protect your portfolio from the negative effects of short-term market events.

A “buffer” strategy utilizes options to seek to provide a targeted level of downside protection, should markets experience negative returns. The tradeoff for this downside protection is that the strategy is limited on its upside potential over each hedge period.

Synthetic equity/income is a form of deferred compensation that mirrors some of the benefits of real stock ownership without granting actual shares.

Thematic ETFs are exchange-traded funds (ETFs) that concentrate on particular industries, trends, or themes like technology, sustainability, or developing markets. They provide a way to invest in themes or trends that align with your interests or investment strategy.

An exchange-traded fund (ETF) is a pooled investment security that can be bought and sold like an individual stock.

A momentum fund/ETF is an investment fund that invests in companies based on current trends in such things as earnings or price movement.

A hedge fund ETF is an exchange-traded fund that seeks to replicate the trading activity and investment strategy of a traditional hedge fund.

Assets under management (AUM) is the market value of the investments managed by a person or entity on behalf of clients. AUM is used in conjunction with management performance and management experience when evaluating a company.

The term "bucket" is used in business and finance to describe a grouping of related assets or categories.

Zero interest-rate policy (ZIRP) is a macroeconomic concept describing conditions with a very low nominal interest rate, such as those in contemporary Japan and in the United States from December 2008 through December 2015 and again from March 2020 until March 2022 amid the COVID-19 pandemic.

This communication was prepared by Strategas Asset Management, LLC ("we" or "us" or “our”). This communication represents our views as of 06/24/2024, which are subject to change, and are presented for illustrative purposes only. The information contained herein has been obtained from sources we believe to be reliable, but no guarantee of accuracy can be made. This communication is provided for informational purposes only and should not be construed as an offer, recommendation, nor solicitation to buy or sell any specific security, strategy, or investment product. This communication does not constitute, nor should it be regarded as, investment research or a research report or securities recommendation and it does not provide information reasonably sufficient upon which to base an investment decision. This is not a complete analysis of every material fact regarding any company, industry, or security. Additional analysis would be required to make an investment decision. This communication is not based on the investment objectives, strategies, goals, financial circumstances, needs or risk tolerance of any particular client and is not presented as suitable to any other particular client. Past performance does not guarantee future results. All investments carry some level of risk, including loss of principal.

Strategas Asset Management, LLC is an SEC Registered Investment Adviser affiliated with Strategas Securities, LLC, a broker-dealer and FINRA member firm, and an SEC Registered Investment Adviser. Both Strategas Asset Management, LLC and Strategas Securities, LLC are affiliated with Robert W. Baird & Co. Incorporated ("Baird"), a broker-dealer and FINRA member firm, and an SEC Registered Investment Adviser, although the firms conduct separate and distinct businesses.