DWUS: 4th Quarter 2023 Portfolio Review
Strategy
The AdvisorShares Dorsey Wright FSM US Core ETF’s (DWUS) uses relative strength to allocate towards the strongest performing areas of the Large-Cap US space using broad market and factor ETFs. The strategy implements Dorsey Wright’s proprietary fund scoring method that is built around relative strength and momentum. The top two ranked funds at each seasonal quarterly evaluation are selected as the holdings. The strategy is not constrained to holding a set allocation to any sector, style, cap, or factor. This allows the portfolio to over or underweight markets to concentrate on areas of strength in the Large-Cap US market, often pushing the portfolio to vary from a standard broad market benchmark
Performance
DWUS benefitted from its overweight of growth in the fourth quarter of 2023 and gained 12.86% (market) over the last three months of the year. Its benchmark, the S&P 500 Index, gained 11.69%. With its outperformance in the fourth quarter, DWUS was able to post a 2023 return of 20.47% (market). As growth continues to hold relative strength over other styles, the momentum strategy underneath DWUS will benefit if this trend holds in 2024.
Holdings
The portfolio continues to be allocated to securities that we believe to display favorable relative strength characteristics. The portfolio is made up of two ETFs, both of which have shown high relative strength versus the broad market. DWUS did not make any changes in the fourth quarter and continues to hold the Invesco QQQ Trust and the SPDR S&P 500 ETF Trust. With its allocation to QQQ and SPY, DWUS is heavily weighted in the largest stocks in US and is highlighted by names like Apple and Microsoft. Over the past quarter, Costco has snuck into the top 10 of stock exposure.
| Ticker | Security Description | Portfolio Weight % |
| QQQ | INVESCO QQQ TRUST SERIES 1 | 50.25% |
| SPY | SPDR S&P 500 ETF TRUST | 49.44% |
As of 12.31.2023. Cash not included.
| Top 10 Stocks Underlying Exposure |
| Security Description | Ticker | Portfolio Weight % |
| Apple Inc. | AAPL | 8.11% |
| Microsoft Corporation | MSFT | 7.77% |
| Amazon.com, Inc. | AMZN | 4.14% |
| NVIDIA Corporation | NVDA | 3.40% |
| Meta Platforms Inc. Class A | META | 2.91% |
| Tesla, Inc. | TSLA | 2.70% |
| Broadcom Inc. | AVGO | 2.70% |
| Alphabet Inc. Class A | GOOGL | 2.30% |
| Alphabet Inc. Class C | GOOG | 2.12% |
| Costco Wholesale Corporation | COST | 1.53% |
As of 12.31.2023.
Sector
As one might expect, the heavy overweight towards growth has DWUS most concentrated in the technology and consumer discretionary sectors. On the other hand, energy, real estate, and materials are the three most underweight sectors. Industrials, healthcare, and communication services each hold roughly 10% of the underlying sector exposure.
As of 12.31.2023
Respectfully,
Nasdaq Dorsey Wright
AdvisorShares Dorsey Wright FSM US Core ETF (DWUS) Portfolio Model Manager
Past Commentary
Definition:
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.
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 Advisor’s judgment about the markets, the economy, or companies may not anticipate actual market movements, economic conditions or company performance, and these factors may affect the return on your investment. The prices of equity securities rise and fall daily. These price movements may result from factors affecting individual issuers, industries or the securities market as a whole. The market value of debt securities held by the Fund typically changes as interest rates change, as demand for the instruments changes, and as actual or perceived creditworthiness of an issuer changes.
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.