SURE: 2nd Quarter 2023 Portfolio Review
2023 has turned out to be good for equity investors so far. In a significant policy shift, the Federal Reserve in June decided to pause its series of interest rate hikes in light of slowing inflation. This marked the first time since March 2022 that the Fed has refrained from raising rates, addressing heightened investor concerns. This pause can be viewed as a sign of stability, providing companies with clearer guidance on the borrowing landscape ahead.
Despite the high prices, the resilience of the US consumer cannot be understated. Data from the retail sector provides tangible proof of this economic vitality. US retail sales have grown consistently over the past four months. This uptrend suggests that consumer confidence remains robust, underpinned by solid job numbers and wage growth.
From Aug 15, 2022 to July 31, 2023.
As a result, there now seems to be a prevailing sentiment that the economy is headed for a soft landing rather than a hard crash. Apple’s decision to add $90 billion to its authorized buyback capacity in April and Google’s massive $70 billion buyback announcement, hot on the heels of completing a prior authorization of the same size, underscore this confidence. These buybacks not only indicate corporate optimism but also suggest that these tech giants believe their stock prices have more space to grow. The tech sector has played a pivotal role in propelling the broader market to its highest level in over a year, riding on surging enthusiasm over artificial intelligence and its myriad applications.
As of July 31, 2023.
|Ticker||Security Description||Portfolio Weight %|
|EXP||EAGLE MATERIALS INC||1.35%|
|AMAT||APPLIED MATERIALS INC||1.25%|
|HCA||HCA HEALTHCARE INC||1.25%|
|DHI||DR HORTON INC||1.22%|
|AEL||AMERICAN EQUITY INVT LIFE HL||1.19%|
As of 06.30.2023. Subject to change.
With this backdrop, where does the AdvisorShares Insider Advantage ETF fit in? The ETF presents a compelling proposition, as it offers investors the potential for amplified total shareholder return, deriving benefits from both stock buyback and dividend. After witnessing a nearly 40% run in technology stocks this year, the fund also ensures that investors are not overly exposed to one sector. Instead, it provides a more balanced, diversified portfolio compared to other market cap-weighted portfolios. For investors seeking growth coupled with diversification, this ETF beckons as an attractive choice.
Qubed Capital, LLC
AdvisorShares Insider Advantage ETF (SURE) Portfolio Strategist