The Global X Adaptive U.S. Factor ETF (AUSF) performance compared to similar ETFs

The Global X Adaptive U.S. Factor ETF (AUSF) is a passively managed ETF that utilizes a multi-factor equity strategy based on value, momentum, and low volatility. However, despite its strategic approach, AUSF has not consistently outperformed its benchmark, the iShares Core S&P 500 ETF (IVV), in the past. Although AUSF managed to weather the 2022 bear market relatively well, it did not fully protect itself from steep drawdowns during sell-offs. Currently, AUSF displays a contrarian tilt, favoring less expensive and less volatile stocks while ignoring growth stocks. Its performance has been comparatively lackluster when compared to other similar ETFs, such as the Invesco Russell 1000 Dynamic Multifactor ETF (OMFL) and the BlackRock U.S. Equity Factor Rotation ETF (DYNF). The current factor mix of AUSF indicates a decreasing allocation to growth stocks and an emphasis on low-beta stocks, suggesting a potential preparation for a market correction. While neither justifying a bullish thesis nor warranting a sell rating, a hold rating seems more appropriate for AUSF at this time.

Introduction

The Global X Adaptive U.S. Factor ETF (AUSF) is a passively managed ETF that utilizes a multi-factor equity strategy based on value, momentum, and low volatility. In this article, we will evaluate the performance of AUSF during market downturns, compare it with the iShares Core S&P 500 ETF (IVV), analyze its performance in comparison to similar ETFs, scrutinize its factor mix and investment strategy, compare its performance with peers, and examine the factors contributing to its performance. Additionally, we will discuss the bullish and bearish outlook for AUSF and provide a comprehensive assessment of its viability as an investment option.

Performance during Market Downturns

In order to assess the effectiveness of AUSF in protecting against market downturns, we will analyze its performance in the 2022 bear market. While AUSF weathered the bear market relatively well, it did not fully protect itself from steep drawdowns during sell-offs. This indicates that the ETF’s strategy may not be as effective as desired in terms of downside protection. AUSF’s performance will be compared with the iShares Core S&P 500 ETF (IVV) to gauge its relative performance during market downturns.

Comparison with Similar ETFs

AUSF will also be compared with similar ETFs to gauge its performance in relation to its peers. The Invesco Russell 1000 Dynamic Multifactor ETF (OMFL) and the BlackRock U.S. Equity Factor Rotation ETF (DYNF) will be examined in this regard. Key performance metrics, such as returns and risk-adjusted returns, will be analyzed to determine how AUSF stacks up against these competitors.

Factor Mix and Investment Strategy

AUSF’s multi-factor equity strategy is based on value, momentum, and low volatility. The ETF currently exhibits a contrarian tilt, favoring less expensive and less volatile stocks while ignoring growth stocks. This factor mix will be thoroughly evaluated to understand the implications of AUSF’s investment strategy. Furthermore, the focus on less expensive and less volatile stocks may indicate preparation for a market correction. We will discuss the potential implications of this strategy and factor mix.

Comparison of AUSF’s Performance

In order to fully assess AUSF’s performance, we will compare it with similar ETFs. Specifically, we will evaluate AUSF’s returns and risk-adjusted returns in comparison to other ETFs within its category. This analysis will provide insights into how AUSF has performed relative to its peers in different market conditions.

Analysis of Factors Contributing to AUSF’s Performance

To gain a deeper understanding of AUSF’s performance, we will identify specific factors that have influenced its performance. Factors such as value, momentum, and low volatility will be evaluated to determine their role in driving AUSF’s performance. This analysis will shed light on the underlying factors behind AUSF’s returns and help assess the effectiveness of its investment strategy.

Bullish and Bearish Outlook

The outlook for AUSF will be subject to debate, considering its past performance, investment strategy, and factor mix. We will assess AUSF’s strategy and factor mix to determine whether it supports a bullish or bearish outlook. However, based on the available information, a hold rating seems to be more appropriate for AUSF. While the strategy and factor mix are not necessarily negative, they also do not warrant a bullish recommendation.

Conclusion

In conclusion, the Global X Adaptive U.S. Factor ETF (AUSF) utilizes a multi-factor equity strategy based on value, momentum, and low volatility. While AUSF has not consistently outperformed the iShares Core S&P 500 ETF (IVV) in the past, it has demonstrated some resilience during market downturns. However, AUSF’s performance has been unimpressive compared to similar ETFs such as the Invesco Russell 1000 Dynamic Multifactor ETF (OMFL) and the BlackRock U.S. Equity Factor Rotation ETF (DYNF). AUSF’s factor mix and investment strategy, focused on less expensive and less volatile stocks, may indicate preparation for a market correction. Overall, a hold rating would be more appropriate for those considering AUSF as an investment option.