SMI 3Fourteen FC Trend ETF (FCTE)
NASDAQ (NMS) NASDAQ (NMS) Primary Summary
FCTE Chart
FCTE: Valuation Is Up, Growth Is Down, And Earnings Momentum Has Collapsed
SMI 3Fourteen Full-Cycle Trend ETF takes a proprietary "Full Cycle Trend" approach to select 20 U.S. stocks based on quality, trend, and momentum screens, among others. Its expense ratio is high at 0.85%. My initial coverage from October was reasonably positive, though I maintained a healthy degree of skepticism, as is appropriate for such a new and highly active ETF. I was prepared for high turnover, but what I wasn't expecting was such a dramatic change in portfolio fundamentals. Unfortunately, most of the changes were negative.
FCTE: Muted Performance After Energetic Start, Still Worth Watching, A Hold
FCTE is an actively managed vehicle with a strategy designed "to identify and own stocks that can outperform the S&P 500 across the entire market cycle." It has a portfolio of just 20 stocks. Adjustments are made monthly as "the screens are rerun." FCTE's factor mix is currently heavy in quality, light in value, with adequate growth exposure. Consumer staples, energy, utilities, and real estate are ignored.
FCTE: Will Boutique Research Translate Into Market-Beating Returns?
I own a small position in the SMI 3Fourteen Full-Cycle Trend ETF. The Fund aims to outperform the S&P 500 over the full investment cycle, using a proprietary "Full-Cycle Trend" strategy which targets high-quality large-cap companies. The Fund does not have a track record, has a relatively high expense ratio, and is dependent on the success of its proprietary investment strategy.
SMI 3Fourteen FC Trend ETF Investors
| Name | Quantity | Cost | Value | Profit ($) | Gain (%) |
|---|---|---|---|---|---|
| RCS Ryan Charles Stout Theory Financial LLC | 304,894 | $7.69M | $8.79M | $1.09M | 14.21% |
| NCM NCM Capital Management LLC NCM Capital Management LLC | 16,600 | $431,765.5 | $478,578 | $46,812.5 | 10.84% |
 KURT TRAULSEN EVOLUTION WEALTH MANAGEMENT INC. | 776 | $19,322 | $22,511.76 | $3,189.76 | 16.51% |
| AJP Aaron J. Plautz Principia Wealth Advisory LLC | 368 | $9,163 | $10,556.08 | $1,393.08 | 15.2% |
 VestGen Advisors LLC VestGen Advisors LLC | 58,461 | $1.47M | $1.69M | $214,768.1 | 14.59% |
SMI 3Fourteen FC Trend ETF (FCTE) FAQ
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SMI 3Fourteen FC Trend ETF Profile
| NASDAQ (NMS) Exchange | US Country |
Overview
The fund described operates as an actively managed investment vehicle, primarily focusing on holding a select portfolio of domestic stocks. Most notably, these stocks are generally part of the esteemed S&P 500 Index, reflecting the fund's strategy to invest in high-performing and stable American companies. Developed by 3Fourteen, the proprietary model underlying the fund's strategy meticulously selects stocks through a comprehensive analysis of quality indicators and trend factors. These include critical financial metrics such as return on capital, cash flow stability, earnings growth, and return on investment, as well as analyzing momentum, linear regression, and overall trend analysis to guide its selections. This approach distinguishes the fund by opting for quality over quantity, concentrating its investments in roughly 20 stocks for focused exposure rather than diversifying widely. Despite its non-diversified status, the fund aims to achieve substantial returns by leveraging the robustness of the S&P 500's constituent companies through a meticulous and analytical selection process.
Products and Services
The fund offers an investment product characterized by a focused and analytical approach to stock selection within the S&P 500 Index. The following outlines the core aspects of this product:
- Actively Managed Portfolio: The fund's portfolio is actively managed, aiming to outperform its benchmark by selecting stocks based on a sophisticated proprietary model. This model evaluates companies on various fronts, including financial health, growth prospects, and stock performance trends.
- Proprietary Selection Model: Utilizing a proprietary model developed by 3Fourteen, the fund selects stocks by employing quality stock screens and analyzing trend factors. Key metrics include return on capital, cash flow stability, earnings growth, return on investment, momentum, linear regression, and trend analysis. This rigorous selection process is designed to identify stocks with the potential for sustainable performance.
- Concentrated Portfolio: Unlike broadly diversified funds, this investment strategy focuses on approximately 20 domestic stocks typically included in the S&P 500 Index. This concentrated approach allows for targeted investments in companies believed to offer the best potential for growth and stability, based on the fund's analytical model.
- Non-Diversified Fund Status: Operating as a non-diversified fund, it puts substantial investments into a relatively small number of stocks. This strategy can lead to higher volatility and risk but also offers the potential for greater returns by capitalizing on the concentrated picks that the fund's model identifies as having strong upward potential.
