Weakness in BANCREEK U.S. Large Cap ETF's People and Process Pillar ratings limits this strategy to a Morningstar Medalist Rating of Negative. The strategy charges fees in line with its similarly distributed peers, priced within the middle quintile.  

 The strategy's inexperienced portfolio management team drives the strategy's Low People Pillar. The strategy earns a Below Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained a substantial overweight position in momentum exposure and quality exposure compared with category peers. Momentum exposure is attributed to holding stocks currently on a winning streak and selling those that are on a downtrend. And a high quality exposure is rooted in holding stocks with low financial leverage and strong returns on equity. To be considered a quality steward, this strategy's parent organization needs to improve factors like insignificant personal investments from portfolio managers and relatively short-tenured portfolio managers. As a result, the firm obtains a Below Average Parent Pillar rating.

Analyst Rating

Quanta Services

Eaton

Hubbell

Motorola Solutions

Broadcom

CBIZ

Hershey

Republic Services

W.W. Grainger

Danaher

Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category index on a risk-adjusted basis over the long term. Bancreek U.S. Large Cap ETF earns a Below Average Process Pillar rating. 

The process benefits from the firm's five-year retention rate of 100% over the period. However, the rating is held back by the experience of the management team, which averages three years at this fund. High costs across its parent firm's funds, whose fees rank in their respective category's most-expensive quintile on average, also limit the process. While this fund's costs are most relevant to investors, the pattern at the broader firm suggests it could do more to keep fees low.

 This strategy skews toward smaller, higher-growth companies compared with its average peer in the Large Blend Morningstar Category. Analyzing additional factors, this strategy has continually had exposure to high-momentum stocks compared with Morningstar Category peers in the last few years. Momentum approaches bet that rising stocks will continue to rise and that lagging stocks will continue to lag. In recent months, the strategy was more exposed to the Momentum factor compared with its Morningstar Category peers as well. This strategy also has tilted in favor of high-quality stocks, those that have demonstrated low financial leverage and solid return on equity, during these years. High exposure to the quality factor means holding companies that are consistently profitable, growing, and have solid balance sheets. Compared with category peers, the strategy also had more exposure to the Quality factor in the most recent month. Additionally, the managers have consistently taken on more risk, demonstrated by higher volatility exposure than peers. This orientation tends to pay off most prominently when markets are hot. In this month, the strategy also had more exposure to the Volatility factor over its peers. More information on a fund and its respective category's factor exposure can be found in the Factor Profile module within the Portfolio section. 

 The portfolio is overweight in industrials by 33.9 percentage points in terms of assets compared with the category average, and its basic materials allocation is similar to the category. The sectors with low exposure compared to category peers are technology and communication services, underweight the average by 10.1 and 5.4 percentage points of assets, respectively. The portfolio is composed of 35 holdings and is less top-heavy than peers. Specifically, 41.7% of the portfolio's assets are concentrated within the top 10 fund holdings, compared to the typical peer's 49.5%.

Below Average

Process

Bancreek U.S. Large Cap ETF earns a Low People Pillar rating. The most substantial detractor from the rating is the experience of the management team, which averages three years at this fund. The managers' failure to consistently outperform peers at the funds they run, as measured by their combined three-year manager excess returns, also detracts from the team. The number of months that the management team has been running this vehicle together limits the rating further. Since this is a newly incepted product, more time is needed to monitor the team's capability at executing the strategy.


None of the portfolio managers here invest in this fund. This hurts the rating because manager investment would align their interests with the strategy's investors.

People

Bancreek Capital Advisors is a relative newcomer with only three months of operation as a firm under its belt. It is too nascent to prove whether it has an edge over peer asset managers, earning it a Below Average Parent Pillar rating. The firm currently manages one vehicle, with a total of $29.0 million under management across a team of five strategy managers. Bancreek Capital Advisors is a new firm, so it is not surprising that it has an inexperienced management team with an average of over three years in the industry. The firm's earliest portfolio manager hire, Andrew Serowik, has six years of industry experience but has not been an industry standout on other strategies. 
 
   

 As Bancreek Capital Advisors builds and continues to develop a track record, its rating will be adjusted accordingly.

Parent

Bancreek US Large Cap ETF

BCUS is an actively managed fund that invests in US large-cap companies the sub-adviser believes exhibit structurally advantaged business models.

Bancreek International Large Cap ETF

Exchange Traded Concepts and Bancreek Capital Advisors have teamed up to launch an active international large-cap ETF. The Bancreek International Large Cap ETF (BCIL) began trading on the NYSE on March 21.

ETC and Bancreek Launch Active International ETF

NEW YORK , March 21, 2024 /PRNewswire/ -- Exchange Traded Concepts is pleased to announce the launch of the Bancreek International Large Cap ETF (NYSE: BCIL). The Fund began trading on the New York Stock Exchange on 3/21/24.

Exchange Traded Concepts Announces Launch of BCIL ETF with Bancreek Capital Advisors

Exchange Traded Concepts announced the launch of the Bancreek U.S. Large Cap ETF (NYSE Arca: BCUS). The fund began trading on the New York Stock Exchange Thursday.

Bancreek Launches Active US Large-Cap ETF

NEW YORK , Dec. 21, 2023 /PRNewswire/ -- Exchange Traded Concepts is pleased to announce the launch of the Bancreek U.S. Large Cap ETF (NYSE: BCUS). The Fund began trading on the New York Stock Exchange on 12/21/2023.

News for Bancreek US Large Cap ETF ETF (BCUS)