Weakness in Macquarie Global Listed Infras ETF's People and Process Pillar ratings limits this strategy to a Morningstar Medalist Rating of Neutral. The portfolio maintains a cost advantage over competitors, priced within the cheapest fee quintile among peers.  

 The longest-tenured manager has a wealth of experience, but due to other weaknesses, the strategy earns a Below Average People Pillar. The strategy gets a Below Average Process Pillar rating.  Momentum is the premise that stocks that have recently outperformed will continue to do so. With low momentum exposure, the portfolio is holding stocks that managers believe to be undervalued. And a low quality exposure is rooted in stocks with higher financial leverage and lower profitability. The strategy's parent organization earns the firm an Average Parent Pillar rating, and this rating is inherited from vehicles belonging to the same branding entity and is indirectly assigned by an analyst.

Analyst Rating

NextEra Energy

Servotronics

Essential Utilities

Seritage Growth Properties

Crown Castle International

Exelon

Sempra Energy

Eversource Energy

Trinity Industries

CMS Energy

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. Macquarie Global Listed Infras ETF earns a Below Average Process Pillar rating. 

The process is bolstered by the experience of the management team, which averages 18 years at this fund. However, the rating is limited by the parent firm's five-year risk-adjusted success ratio of 47%. The measure indicates the percentage of a firm's funds that survived and outperformed their respective category's median Morningstar Risk-Adjusted Return for the period. The parent's relatively low success ratio suggests that the firm could do better across its fund lineup. The parent firm's five-year retention rate of 50% also holds the process back.

 This strategy has more exposure to the Growth factor than the Infrastructure Morningstar Category average. But in terms of market capitalization, it is on par with peers. Examining additional factor exposure, this strategy has had relatively low exposure to momentum stocks compared with Morningstar Category peers continually in the last few years. Momentum investors tend to expect stocks that have done well recently to continue to do so in the short term. Momentum approaches can entail higher turnover and trading costs since the top stocks can often change. In the latest month, the strategy was also less exposed to the Momentum factor compared with Morningstar Category peers. This strategy has also tilted toward low-quality stocks, companies with higher financial leverage and lower profitability over peers in recent years. Such positions do not tend to provide much ballast for a portfolio. Similarly, in recent months, the strategy also had less exposure to the Quality factor than peers. In addition, this strategy has exhibited a tilt toward higher-volatility stocks in these years, meaning companies that have a higher historical standard deviation of returns compared with peers. Such exposure tends to pay off when markets are hot and to be costly when they are not. Nevertheless, the fund's Volatility exposure was in line with peers in the latest month. 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 utilities and real estate relative to the category average by 24.4 and 4.0 percentage points, respectively. The sectors with low exposure compared to category peers are industrials and energy, underweight the average by 14.2 and 7.3 percentage points of assets, respectively. The portfolio is positioned across 30 holdings and is quite concentrated. Specifically, 49.0% of the fund’s assets are housed within the top 10 holdings, as opposed to the category average of 28.6%.

Below Average

Process

Macquarie Global Listed Infras ETF earns a Below Average People Pillar rating. The team is bolstered by the portfolio managers' outperformance of peers at the funds they run, as measured by their combined three-year manager excess returns. However, the rating is weakened by the parent firm's five-year success ratio of 48%. The measure indicates the percentage of a firm's funds that survived and outperformed their respective category's median return for the period. The parent's subpar success ratio suggests that the firm could do better across its fund lineup. The parent firm's five-year retention rate of 50% also detracts from the team.


Bradford L. Frishberg, the longest-tenured manager on the strategy, provides strong guidance, bringing forward 24 years of listed portfolio management experience. The average Morningstar Rating of the strategies they currently manage is 3.8 stars, demonstrating encouraging risk-adjusted performance. Despite having a small team, the two listed managers boast 18 years of listed portfolio management experience.

People

Macquarie Asset Management is part of Macquarie Group, whose interests span banking, advice, and funds management. Asset management has grown considerably since Macquarie pioneered an infrastructure business in the 1990s, totaling about AUD 770 billion (at March 2022) split roughly 70/30 in public/private markets. In Australia, Macquarie also distributes third-party managers catering to high-net-worth clients. Macquarie has methodically integrated U.S.-based Delaware Investments since acquiring it in 2009. This is especially visible in fixed interest, a significant component following several years of successful and stable management. Macquarie’s opportunism has its merits, though it can engender staffing and product distractions when integrating overlapping capabilities, such as Waddell & Reed (Ivy Investments) and AMP Capital in 2021/22. More pertinently, across the substantial footprint of public market assets beyond fixed interest, we see few examples of clear strength or conditions that are clearly conducive to maintaining lasting success. When allied to an uneven history with internally managed equity capabilities (including Australian fundamental and Asian equities), we are more circumspect. That said, fund performance influences 70% of variable staff remuneration, which helps investor alignment, while longer-term remuneration comes via gradually vesting Macquarie stock.

Average

Parent

Macquarie Global Listed Infrastructure ETF

BILD seeks total return through an actively managed portfolio of global-listed infrastructure companies screened for various sustainability criteria.

Macquarie Energy Transition ETF

Macquarie Tax-Free USA Short Term ETF

Macquarie Asset Management has launched a suite of actively managed ETFs on the New York Stock Exchange. The funds target global infrastructure, energy transition, and municipal bonds.

News for Macquarie Global Listed Infrastructure ETF ETF (BILD)