BEDZ: 2nd Quarter 2023 Portfolio Review
Performance
BEDZ continued its positive trend in the 2nd quarter of 2023. BEDZ’s net asset value (NAV) was up 3.57%. The Fund did lag behind the S&P 500, which was up 8.74% for the quarter.
Portfolio
The hotel industry is a vital component of the global travel and tourism sector. It encompasses various types of accommodations, including luxury hotels, resorts, budget hotels, boutique hotels, and more. The industry is highly influenced by factors such as economic conditions, travel trends, technological advancements, and global events. Growth continued to be driven by the post pandemic urge to travel and increases in corporate travel, despite fears of a recession.
Winners/Losers
The portfolio’s leaders were new position Royal Caribbean Cruises LTD (RCL), up 61.46% for the quarter, and Bluegreen Vacation Holdings (BVH), up 30.4% for the quarter. The portfolio’s laggards were Playa Hotels & Resorts (PLYA), down -13.22% for the quarter, and the REIT Service Properties Trust (SVC), down -12.31% for the quarter.
Important Portfolio Trades
Several trades were made throughout the quarter, including the removal of Chatham Lodging Trust (CLDT) and the reduction of 5,432 shares of Park Hotels & Resorts INC (PK). Our positions were increased in Service Properties Trust (PK) by 2,250 shares and VICI Properties Inc (VICI) by 1,594 shares. Other trades were smaller tactical adjustments to the portfolio.
New Positions
BEDZ added a new positions in Royal Caribbean Cruises LTD (RCL), as already mentioned, with 2,000 shares and in Ryman Hospitality Properties (RHP) with 2,100 shares.
Top Holdings
| Ticker | Security Description | Portfolio Weight % |
| BVH | BLUEGREEN VACATIONS HOLDING | 6.40% |
| MAR | MARRIOTT INTERNATIONAL -CL A | 5.63% |
| GHG | GREENTREE HOSPITALITY GR-ADR | 5.57% |
| BKNG | BOOKING HOLDINGS INC | 5.55% |
| BYD | BOYD GAMING CORP | 5.38% |
| IHG | INTERCONTINENTAL HOTELS-ADR | 5.12% |
| RCL | ROYAL CARIBBEAN CRUISES LTD | 4.96% |
| HLT | HILTON WORLDWIDE HOLDINGS IN | 4.77% |
| SVC | SERVICE PROPERTIES TRUST | 4.72% |
| HGV | HILTON GRAND VACATIONS INC | 4.72% |
As of 06.30.2023. 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
With the summer season and travel restrictions eased, the hotel industry continues to show signs of recovery. The demand for domestic travel has been stronger than international travel, both have reached pre-pandemic levels. Hotels are adapting to changing customer preferences, such as an increased focus on hygiene, flexible booking policies, and digital experiences.
Past Commentary
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, 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.