BEDZ: 3rd Quarter 2025 Portfolio Review
Portfolio
Performance
In Q3 2025, BEDZ returned 6.78% (NAV) | 6.79% (market), slightly lagging behind the S&P 500 Index which gained 8.12% over the same period, as the global hotel and lodging sector showed a blend of strengths and challenges.
Portfolio
The global hotel and lodging industry remains a central pillar of the broader travel and tourism economy, encompassing everything from luxury resorts and international chains to boutique properties and budget accommodations. Historically, the sector tends to outperform during periods of economic expansion and strong travel demand.
In the current environment, however, tightening financial conditions and softer consumer confidence have slowed the pace of growth. Despite these near-term challenges, the long-term outlook remains constructive, supported by evolving travel preferences and continued digital transformation across the industry.
While short-term growth may be more measured, the sector’s ability to adapt to changing consumer behavior and embrace technology-driven innovation positions the industry for sustained, gradual expansion in the years ahead.
Winners/Losers
Several holdings contributed positively to performance this quarter.
- Expedia Group Inc. (EXPE): up 20.96%
- Tripadvisor Inc. (TRIP): up 24.60%
- Trip.com Group Ltd. (TCOM): up 28.24%
On the other hand, some holdings faced headwinds amid heightened market volatility and sector-specific pressures:
- Travelzoo (TZOO): down -22.78%
- Booking Holdings Inc. (BKNG): down -6.57%
- Marriot International Inc. (MAR): down -4.43%
Important Portfolio Trades
During the quarter, BEDZ made several strategic adjustments to better align the portfolio with emerging trends and opportunities in the travel and lodging space.
BEDZ initiated positions in:
- Host Hotels & Resorts Inc. (HST): 5,200 shares
- SOHO House & Co. Inc. (SHCO): 15,400 shares
BEDZ reentered positions in:
- AirBnb Inc. (ABNB): 500 shares
BEDZ exited positions in:
- Atour lifestyle Holdings (ATAT)
- Playa Hotels & Resorts (PLYA) – was acquired by Hyatt Hotels Corp. (H)
Top Holdings
| Ticker | Security Description | Portfolio Weight % |
| BKNG | BOOKING HOLDINGS INC | 5.28% |
| MCRI | MONARCH CASINO & RESORT INC | 5.25% |
| BYD | BOYD GAMING CORP | 5.23% |
| CCL | CARNIVAL CORP | 5.17% |
| TCOM | TRIP.COM GROUP LTD-ADR | 5.12% |
| SHCO | SOHO HOUSE & CO INC | 4.76% |
| NCLH | NORWEGIAN CRUISE LINE HOLDIN | 4.63% |
| RCL | ROYAL CARIBBEAN CRUISES LTD | 4.57% |
| APLE | APPLE HOSPITALITY REIT INC | 4.56% |
| EXPE | EXPEDIA GROUP INC | 4.44% |
As of 09.30.2025. Cash is excluded. Holdings are subject to change.
Please see our complete Fund holdings at advisorshares.com/etfs/bedz. The holdings details are updated each market day.
Market Update
In Q3 2025, the global hotel and lodging industry posted a mixed performance. Demand remained resilient across core segments such as leisure and business travel, yet the sector faced headwinds from softening group demand and more cautious consumer spending amid broader economic pressures.
The industry continued to contribute meaningfully to global growth. India’s hotel market surged, supported by festivals and strong activity in the Meetings, Incentives, Conferences, and Exhibitions (MICE) segment. In the United States, hospitality trends evolved alongside shifting traveler preferences, reflecting a focus on value, convenience, and experience.¹
Key challenges persisted. Rising insurance costs and competition from short-term rentals placed pressure on margins. However, these were offset by encouraging signs: TSA checkpoint throughput rose 1.5% in August, signaling steady travel activity, while wage growth continued to outpace inflation, supporting consumer confidence in travel spending.²
Workforce constraints remained a defining issue. While employment levels improved across hospitality and service roles, turnover rates stayed high, creating sustained pressure on labor efficiency and guest service capacity.
Looking ahead, the industry outlook for late 2025 into 2026 is challenging but cautiously optimistic. Overall performance is projected to decrease by 0.1% in 2025, followed by an estimated 1.8% rebound in Q4, supported by cost optimization strategies and gradual macroeconomic recovery.³
Opportunities are emerging around integrated commercial strategies, digital transformation, and merger and acquisition activity aimed at improving scale and efficiency. Still, risks remain—particularly from regulatory changes, elevated operating costs, and potential declines if occupancy trends weaken further.
Although near-term growth may proceed at a more measured pace, the sector’s underlying fundamentals suggest a foundation for steady, selective expansion in the quarters ahead.
Sources:
1 AHLA. The American Hotel & Lodging Association. 2025 State of the Industry Report.
2 CBRE. Intelligent Investment. U.S. Hotels State of the Union September 2025 Edition. September 2025.
3 Hotel Dive. Graber, Jenna. A pulse check on US hotel performance in a challenged economy. October 2025.
Cheers,
Dan Ahrens
AdvisorShares AdvisorShares Hotel ETF (BEDZ) Portfolio Manager
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 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.