QPX - AdvisorShares Q Dynamic Growth ETF

Putting The Odds In Your Favor

Using heavy tail analysis to more precisely balance risk and reward.

Symbol Exchange Inception Date CUSIP Indicative Value
QPX NYSE Arca 12/28/2020 00768Y 438 QPX.IV

 

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<strong>About The ETF</strong>

QPX is an actively managed ETF seeking to target equity market upside while tactically managing downside risk during abnormal market volatility. Using ETFs, QPX may invest in a broad variety of equities across market cap, style or sectors and will use various fixed income categories and commodities to manage risk. QPX applies ThinkBetter’s Q Methodology™ proprietary risk management program to optimally allocate the fund’s assets against a given level of risk. Normally, QPX seeks to provide broad-market equity like returns and re-optimizes the portfolio monthly. However, during periods of high market volatility, QPX can allocate to a more defensive portfolio and seek short-term fixed income returns. QPX’s market volatility indicator, the Q Implied Volatility Index™ (QIX), is reviewed daily which may result in mid-month allocation changes. Asset classes may be added or removed from QPX’s portfolio based on changing risk/reward characteristics.

<strong>About Q Methodology™</strong>

Q Methodology™ is a modern quantitative approach to assessing risk/reward and optimizing investment portfolios. The methodology is based on heavy-tail distribution mathematical analysis and focuses on estimating the downside of a portfolio (expected drawdown) under extreme but plausible stress (tail risk). Using high performance computing power, Q Methodology™ generates tens of thousands of portfolio simulations to identify the asset allocation offering the greatest return for a given level of risk. Simply put, we believe Q Methodology™ is “better math” for better investment management.

<strong>About the Q Implied Volatility Index™ (QIX)</strong>

QIX is a proprietary indicator designed to tactically and unemotionally identify market volatility and to help avoid drawdowns. When QIX indicates normal volatility, QPX will have long equity exposure; when QIX is high, QPX moves to a defensive fixed income portfolio.

<strong>Why Invest in QPX?</strong>
  • Better Math: Better Management – Recognizing the flaws in Modern Portfolio Theory and other Bell curve or Gaussian-based analysis, Q Methodology™ focuses on heavy-tail risk models in an effort to more accurately represent the frequency and impact of more severe losses in financial markets and to optimize risk accordingly.
  • Potential Risk Solution – Q Methodology™ uses modern financial theory and computing power to analyze tens of thousands of potential portfolio simulations and uncover which offers the highest expected return based on a pre-determined level of risk.
  • Flexible Unconstrained Portfolio – Utilizes a broad range of asset classes to optimally balance and avoid risk concentration in the portfolio.
  • Fulcrum Fee Structure – The portfolio manager’s compensation is directly tied to portfolio’s performance. Stronger outperformance is rewarded with a larger management fee while weak or underperformance is penalized with a smaller management fee.
  • Tactical Defense Overlay – QPX seeks to participate in equity market upside while potentially limiting downside exposure caused by unusual market volatility. When QIX is high, QPX will move to defensive fixed income allocation. Once QIX returns to normal levels, QPX will return to its equity-focused risk-optimized portfolio allocation.
<strong>Where Can QPX Fit in a Traditional Portfolio?</strong>

QPX can be used as a core equity position.

<strong>Key Attributes</strong>
  • Quantitative Management Process – QPX removes the emotion from the investment process by using a disciplined, repeatable quantitative process, Q Methodology™, to manage the portfolio.
  • Optimized Risk/Reward Portfolio – QPX targets historical expected drawdown periods of a typical balanced fund and optimizes its portfolio using Q Methodology™ to identify the best risk/reward characteristics.
  • Operational & Tax Efficiency – QPX’s ETF structure allows for diverse asset class and security exposure in a single trade, as well as operational and tax efficiencies.
  • Defense Trigger – When triggered, QPX’s portfolio will tactically allocate to a more defensive portfolio and seek short-term fixed income returns until market volatility returns to normal.
<strong>About the Portfolio Manager</strong>

Ron Piccinini, Ph.D, Chief Investment Officer of ThinkBetter, LLC
Mr. Piccinini’s expertise is in quantitative analysis and business strategy. He wrote his dissertation on heavy-tailed distributions using neural networks in 2004. Mr. Piccinini developed and refined the Q Methodology™, a proprietary heavy tails risk analysis program used in the construction and ongoing management of QPT. He is also the author of the Q Implied Volatility Index ™ (QIX), which is used to measure market volatility and indicate trigger points for defensive portfolio positioning. He co-founded Prairie Smarts, LLC in 2012, a cloud-based risk analytics company that was eventually acquired in 2017 by Covisum. Mr. Piccinini earned a master’s degree from Strasbourg University and holds a Doctorate in Finance from the University of Nebraska-Lincoln. He has worked in various positions related to risk estimation and financial management systems since 2005, including at TD Ameritrade, First National Nebraska, Inc., and First National Bank of Omaha.

 

QPX Overview from Ron Piccinini

Get an introduction to the QPX ETF directly from the portfolio manager, Ron Piccinini.  

 

QPX Overview from Ron Piccinini

Get an introduction to the QPX ETF directly from the portfolio manager, Ron Piccinini.  

Fund

Price History

As of 6/11/2021

NAV $27.16 Closing Price $27.15
Change $0.13 Close Change $0.11
Shares Outstanding 2,110,000 Volume 2349
4PM Bid/Offer Midpoint $27.16 Premium Discount $0
Assets Under Management $57,310,300.94 30-Day Median bid-ask Spread 0.1892864
Premium/Discount Historical Data | NAV Historical Data | Daily Premium/Discount Historical Data

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.

FUND

Characteristics

As of 4/30/2021

QPX Market Cap

QPX Asset Allocation

FUND

Performance

As of 5/31/2021

  NAV Market Price Return S&P 500 Index
1 Month -1.29 -1.30 0.70
3 Months 4.23 4.12 10.72
YTD 6.14 6.12 12.62
Since Inception (12/28/2020 Annualized) 6.12 6.16 13.27

As of 3/31/2021

  NAV Market Price Return S&P 500 Index
1 Month 0.56 0.47 4.38
3 Months 2.41 2.40 6.17
YTD 2.41 2.40 6.17
Since Inception (12/28/2020, Annualized) 2.38 2.44 6.78

Performance data quoted represents past performance and is no guarantee of future results. All Fund data and performance data quoted is believed to be accurate, and unless otherwise stated, is sourced from the Fund administrator, the Advisor’s or Sub-Advisor’s proprietary data, and Morningstar. Current performance may be lower or higher than the performance data quoted. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than original cost. Returns less than one year are not annualized.

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.

Fund

Holdings

As of

Excel    CSV

Date Account Symbol Stock Ticker Security Number Security Description Shares/Par (Full) Price (Base) Traded Market Value (Base) Portfolio Weight % Asset Group
06/11/2021 QPX QQQ 46090E103 INVESCO QQQ TRUST SERIES 1 65,321.00 341.24 22,290,138.04 38.90% MF
XLK 81369Y803 TECHNOLOGY SELECT SECT SPDR 121,646.00 141.97 17,270,082.62 30.14% MF
FDN 33733E302 FIRST TRUST DJ INTERNET IND 42,656.00 234.41 9,998,992.96 17.45% MF
IWO 464287648 ISHARES RUSSELL 2000 GROWTH 10,832.00 307.07 3,326,182.24 5.80% MF
IJR 464287804 ISHARES CORE S&P SMALL-CAP E 26,627.00 114.52 3,049,324.04 5.32% MF
X9USDFIIN FIDELITY INSTL MMKT GOVT 57 1,273,745.88 1.00 1,273,745.88 2.22% MM
CASH 97,588.82 100.00 97,588.82 0.17% CA
Holdings and allocations are subject to risks and to change. A holding identified with an “MM” at the end of its name indicates it is a Money Market fund.

FUND

Fees & Expenses

Management Fee 1.00%
Other Expenses 0.23%
Acquired Fund Fees 0.23%
Net Expense Ratio 1.46%

The management fee above reflects the base fee. Actual management fees may be higher or lower depending on the Fund’s performance compared to its performance benchmark and can range from 0.90% to 1.10%.

    • 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 the Fund’s website at www.AdvisorShares.com. Please read the prospectus carefully before you invest. Foreside Fund Services, LLC, Distributor.
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    • Investing Involves Risk Including possible loss of principal.     
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    • There is no guarantee the Advisors investment strategy will be successful. When models and data prove to be incorrect or incomplete, any decisions made in reliance thereon expose the Fund to potential risks. In addition, the use of predictive models has inherent risk. Because predictive models are usually constructed based on historical data supplied by third parties, the success of relying on such models may depend heavily on the accuracy and reliability of the supplied historical data. The Fund’s particular allocations may have a significant effect on the Fund’s performance. Allocation risk is the risk that the selection of ETFs and the allocation of assets among such ETFs will cause the Fund to underperform other funds with a similar investment objective that do not allocate their assets in the same manner or the market as a whole. For a list of the asset class specific risks please see the prospectus.     
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  • Definitions   
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  • Tail risk is the possibility of an investment’s return moving significantly beyond expectations (i.e., more than three standard deviations from its mean). Expected drawdown is the maximum peak to trough capital loss over a full market cycle (as measured from January 2006 to March 2020).
  • Expected drawdown is the maximum peak to trough capital loss over a full market cycle (as measured from January 2006 to March 2020).