BEDZ: 4th Quarter 2024 Portfolio Review
Portfolio
Performance
In Q4 2024, BEDZ delivered impressive results, achieving an 11.08% increase (NAV and market). As of December 31, 2024, the fund earned a prestigious Five-Star Overall Morningstar Rating within the Consumer Cyclical category*, solidifying its position among the top-performing funds based on risk-adjusted returns out of 48 competitors. For the year, BEDZ posted a strong 18.29% (NAV and market) gain, marking a standout performance in the sector.
Portfolio
The global hotel industry remains a cornerstone of the travel and tourism market, encompassing everything from upscale luxury resorts to affordable lodging and boutique experiences. Influenced by economic trends, shifting travel behaviors, technological advancements, and global events, the sector offers dynamic investment opportunities. Despite its inherent volatility, the industry is particularly well-positioned to benefit from periods of economic growth and heightened travel activity.
Winners/Losers
This quarter, cruise operators took the lead, with Carnival Corp (CCL) surging 34.85%, Royal Caribbean Group (RCL) climbing 30.38%, and Norwegian Cruise Line Holdings (NCLH) rising by 25.45%. On the downside, VICI Properties Inc. (VICI) declined by 11.05%, Viking Holdings (VIK) slipped 5.15%, and Choice Hotels International (CHH) dropped 5.90%.
Important Portfolio Trades
BEDZ made several notable adjustments this quarter. These moves reflect the fund’s strategic approach to capitalizing on emerging trends within the travel and leisure space.
BEDZ exited positions in:
-
- MGM Resorts International (MGM)
- Park Hotels & Resorts Inc. (PK)
- Summit Hotel Properties Inc. (INN)
BEDZ initiated positions in:
-
- Atour Lifestyle Holdings (ATAT): 7,000 shares
- Inspirato Inc. (ISPO): 12,027 shares
- TravelZoo (TZOO): 10,200 shares
BEDZ re-entered positions in:
-
- Pebblebrook Hotel Trust (PEB): 11,700 shares
- Choice Hotels International Inc. (CHH): 1,200 shares
Top Holdings
| Ticker | Security Description | Portfolio Weight % |
| TH | TARGET HOSPITALITY CORP | 6.07% |
| NCLH | NORWEGIAN CRUISE LINE HOLDIN | 5.85% |
| RCL | ROYAL CARIBBEAN CRUISES LTD | 5.83% |
| CCL | CARNIVAL CORP | 5.66% |
| BKNG | BOOKING HOLDINGS INC | 5.27% |
| TCOM | TRIP.COM GROUP LTD-ADR | 5.19% |
| TZOO | TRAVELZOO | 5.14% |
| VIK | VIKING HOLDINGS LTD | 4.90% |
| ATAT | ATOUR LIFESTYLE HOLDINGS-ADR | 4.75% |
| EXPE | EXPEDIA GROUP INC | 4.55% |
As of 12.31.2024. Cash is excluded. Subject to change.
Please see our complete Fund holdings at advisorshares.com/etfs/bedz. The holdings details are updated each market day.
Market Update
Q4 2024 demonstrated steady consumer interest in travel, with cruise lines experiencing significant growth due to their affordability, unique offerings, and expanded accessibility. A notable development in the industry includes Villa Vie Residences, a residential cruise operator offering extended voyages of up to four years, visiting more than 400 destinations. Hotel occupancy rates improved during the quarter, though they have yet to return to pre-pandemic levels. Challenges such as rising inflation and depleted consumer savings led to tighter leisure budgets. Nevertheless, the travel sector’s resilience remains evident, supported by enduring human desire to explore new destinations, ongoing recovery in business and group travel demand, and increased flexibility due to remote work arrangements. Looking ahead to 2025, we anticipate sustained growth in the travel and hospitality sectors, driven by innovation, evolving consumer preferences, and pent-up demand for experiences – all which would potentially benefit BEDZ.
Cheers,
Dan Ahrens
AdvisorShares AdvisorShares Hotel ETF (BEDZ) Portfolio Manager
Past Commentary
* The Morningstar Rating™ for funds, or “star rating,” is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product’s monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods. Past performance is no guarantee of future results.
©2025 Morningstar, Inc. All Rights Reserved. Morningstar and/or its content providers are the proprietors of this information; do not permit its unauthorized copying or distribution; do not warrant it to be accurate, complete or timely; and are not responsible for damages or losses arising from its use. Past performance is no guarantee of future results.
BEDZ received five stars for the overall rating among 48 funds and four stars for the 3-year rating among 48 funds in Morningstar’s Consumer Cyclical category as of December 31st, 2024.
Definitions: The S&P 500 Index is a broad-based, unmanaged measurement of changes in stock market conditions based on the average of 500 widely held common stocks. One cannot invest directly in an index.
Before investing you should carefully consider the Fund’s investment objectives, risks, charges and expenses. This and other information is in the prospectus or summary prospectus, a copy of which may be obtained by visiting www.advisorshares.com. Please read the prospectus carefully before you invest. Foreside Fund Services, LLC, distributor.
Investing involves risk including possible loss of principal. The hotels, restaurants & leisure industry is highly competitive and relies heavily on consumer spending for success. The prices of securities of companies in the industry may fluctuate widely due to general economic conditions, consumer spending and the availability of disposable income, changing consumer tastes and preferences and consumer demographics, in addition may be affected by the availability and expense of liability insurance. Legislative or regulatory changes and increased government supervision. Companies in the hotels, resorts & cruise lines sub-industry may be affected by unique supply and demand factors that do not apply to other sub-industries. Weak economic conditions in some parts of the world, changes in oil prices and currency values, political instability in some areas, and the uncertainty over how long any of these conditions could continue may have a negative impact on the lodging industry. As a result of such current economic conditions and uncertainty caused by the COVID-19 pandemic, the lodging industry may continue to experience weakened demand for occupancy in some markets.
Shares are bought and sold at market price (closing price) not NAV and are not individually redeemed from the Fund. Market price returns are based on the midpoint of the bid/ask spread at 4:00 pm Eastern Time (when NAV is normally determined), and do not represent the return you would receive if you traded at other times.
Holdings and allocations are subject to risks and to change.
The views in this commentary are those of the portfolio manager and may not reflect his views on the date this material is distributed or anytime thereafter. These views are intended to assist shareholders in understanding their investments and do not constitute investment advice.