VICE: 4th Quarter 2020 Portfolio Manager Review

Performance data quoted represents past performance and is no guarantee of future results. 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. For the fund’s most recent standardized and month-end performance, please click www.advisorshares.com/etfs/vice.

On November 1, 2020, the AdvisorShares Vice ETF changed its ticker from ACT to VICE and made a change to its investment strategy. See the prospectus for more information.

Commentary

The fourth quarter of 2020 was very strong again for AdvisorShares Vice ETF (NYSE: VICE). The Fund gained 18.49% on its net asset value (NAV) and 18.85% on its market price. The S&P 500 was up 12.15% for the same period.  For the full calendar year 2020, VICE gained 23.31% on its net asset value (NAV) and 23.67% on its market price while the S&P 500 returned 18.40%.

Changes Happened!

Some exciting changes in the Fund took place during the quarter. The AdvisorShares Vice ETF changed its ticker to “VICE” (it was “ACT”) and switched its listing venue to the NYSE. We also updated our principal investment strategy to allow us to add a gaming, food, and entertainment focus. Please see the Fund’s prospectus at https://etf.as/VICE.

New Positions

The list is extensive, and heavily focused on electronic gaming and food:

(ATVI) Activision Blizzard Inc, (BYD) Boyd Gaming Corp, (EAT) Brinker International Inc, (CHUY) Chuy’s Holdings Inc, (TACO) Del Taco Restaurants Inc, (DPZ) Domino’s Pizza Inc, (GLPI) Gaming And Leisure Properties, (JACK) Jack In The Box Inc, (MCD) McDonald’s Corp, (MCRI) Monarch Casino & Resort Inc, (NVDA) Nvidia Corp, (PENN) Penn National Gaming Inc, (RUTH) Ruth’s Hospitality Group Inc, (TTWO) Take-Two Interactive Software, (HEAR) Turtle Beach Corp, (VICI) Vici Properties Inc, (WING) Wingstop Inc, (YUMC) Yum China Holdings Inc.

Contributors / Detractors

The Fund’s largest holding Boston Beer (NYSE: SAM) is one that I must always talk about. It was up again, but only 12.56% in the 4th quarter, after gaining over 64% for the prior 3-month period. That’s’ fine with me. It’s been a great performer for a long time. RCI Hospitality Holdings (NASDAQ: RICK) gained over 93%. Tobacco (and cannabis-related) company Turning Point Brands (NYSE: TPB) gained over 59%. New holdings Penn National gaming (NASDAQ: PENN) was up 17% in the 4th quarter, Activision Blizzard (NASDAQ: ATVI) up 23%, Take Two Interactive (NASDAQ: TTWO) up 34%, and headphone maker Turtle Beach Corp (NASDAQ: HEAR) was up 31%.

On the negative side, a couple small losers – Molson Coors (NYSE: TAP) a small holding down 1.52%, and YUM China (NYSE: YUMC) down 0.22%.

For those concerned about stock market negativity or volatility with new Presidential policies, I’d like to suggest investing in those things that citizens seem to spend money on no matter what’s happening with the economy or politics…I mean vices like drinking, smoking, gambling and gaming.

Top Holdings

Ticker Security Description Portfolio Weight %
SAM BOSTON BEER COMPANY INC-A 10.14%
TPB TURNING POINT BRANDS INC 6.51%
LVMUY LVMH MOET HENNESSY-UNSP ADR 5.45%
EAT BRINKER INTERNATIONAL INC 5.12%
HEAR TURTLE BEACH CORP 5.06%
ATVI ACTIVISION BLIZZARD INC 4.85%
MCRI MONARCH CASINO & RESORT INC 4.15%
NVDA NVIDIA CORP 4.09%
PENN PENN NATIONAL GAMING INC 4.06%
TACO DEL TACO RESTAURANTS INC 3.78%

As of 12.31.2020. Cash is excluded.

Please see our complete Fund holdings at advisorshares.com/etfs/vice. The holdings details are updated each market day.

Cheers,

Dan Ahrens
AdvisorShares
AdvisorShares Vice ETF (VICE) Portfolio Manager

 

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 risks including possible loss of principal. Companies in the food, beverage and tobacco industry are very competitive and subject to a number of risks. Demographic and product trends, changing consumer preferences, nutritional and health-related concerns, competitive pricing, marketing campaigns, environmental factors, adverse changes in general economic conditions, government regulation, food inspection and processing control, consumer boycotts, risks of product tampering, product liability claims, and the availability and expense of liability insurance can affect the demand for, and success of, such companies’ products in the marketplace. For a full summary of the risks, please see the prospectus.

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 any time thereafter. These views are intended to assist shareholders in understanding their investments and do not constitute investment advice.