The combination of a middling Process Pillar rating and a Below Average People Pillar rating limit  Carbon Collective Climate Sol US Eq ETF to a Morningstar Medalist Rating of Neutral.  The portfolio maintains a cost advantage over competitors, priced within the least expensive fee quintile among peers.  

 The strategy's management team is about as experienced as others, but due to other weaknesses, the strategy earns a Below Average People Pillar. The strategy merits an Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained a substantial overweight position in liquidity exposure and volatility exposure compared with category peers. High liquidity exposure is attributed to stocks with a high trading volume, lending managers more flexibility. And high volatility exposure is rooted in stocks that have a higher standard deviation of returns. The strategy's parent organization doesn't stand out, earning the firm an Average Parent Pillar rating. It has displayed a handful of investor-friendly attributes including high portfolio manager retention and overall low fees.

Analyst Rating

Southern Copper

Nucor

Johnson Controls

Waste Management

Quanta Services

Waste Connections

Carrier Global

Tesla

Steel Dynamics

Cameco

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. Carbon Collective Climate Sol US Eq ETF earns an Average Process Pillar rating. 

The predominant contributor to the rating is the firm's five-year retention rate of 100% over the period. The size of the portfolio management team also bolsters the process. With four portfolio managers, the fund is reasonably well-resourced. Lastly, the process is limited by the experience of the management team, which averages six years at this fund.

 This strategy skews toward smaller, more growth-oriented companies compared with its average peer in the Large Blend Morningstar Category. Examining additional factor exposure, the fund has held stocks with higher trading volumes compared to Morningstar Category Peers in the past few years. More-liquid assets contribute to more-flexible exit strategies without price changes and tend to be a ballast during market selloffs. For example, if the portfolio faces successive redemptions in a short period of time, it will be less likely to experience a significant loss. In recent months, the strategy was more exposed to the Liquidity factor compared with its Morningstar Category peers as well. This strategy has also exhibited a tilt toward high-volatility stocks over these years, meaning it has invested in companies that have a higher historical standard deviation of returns. Such exposure tends to pay off when markets are hot and to be costly when they are not. Compared with category peers, the strategy also had more exposure to the Volatility factor in the most recent month. Additionally, this strategy has had lower yield exposure than peers, with the portfolio holding fewer stocks with high dividend or buyback yields over these years. Its preference for stocks with lower yields may well lead to a growthier portfolio. However, growth stocks court additional risks if their forecasts do not come to fruition and are often more volatile than companies with stable dividends. In recent months, the strategy also had less Yield factor exposure than 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 and basic materials relative to the category average by 33.1 and 13.2 percentage points, respectively. The sectors with low exposure compared to category peers are technology and financial services, underweight the average by 15.1 and 13.4 percentage points of assets, respectively. The strategy owns 220 securities and is about as top-heavy as the category average, with 49.4% of assets in the top 10 holdings. And in closing, in terms of portfolio turnover, on a year-over-year basis, 37% of the fund's holdings have changed, whether through increasing, decreasing, or changing a position.

Average

Process

Carbon Collective Climate Sol US Eq ETF earns a Below Average People Pillar rating. The team is bolstered by the firm's five-year retention rate of 100%. However, the rating is held back by the managers' failure to consistently outperform peers at the funds they run, as measured by their combined three-year manager excess returns. Management team experience, which averages six years at this fund, also weakens the team.


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.

Below Average

People

Since its inception only one year ago, Carbon Collective has demonstrated that it can be trusted as much as the next asset manager. As a result, it has an Average Parent Pillar rating. Carbon Collective currently oversees two vehicles, with a total of $23.7 million under management and a roster of four fund managers.   

 The firm’s economical fees on open-end and exchange-traded funds truly evince a firmwide commitment to minimizing costs and maximizing investors’ returns. The average net expense ratio of the firm’s funds falls within the lowest quintile of firms.  

 To retain an Average rating, Carbon Collective will be expected to uphold a consistent track record of positive investor experience.

Parent

Carbon Collective Climate Solutions US Equity Etf

CCSO is an actively managed fund that invests in US-listed companies who are focused on building solutions to properly address climate change.

BERKELEY, Calif.--(BUSINESS WIRE)--Carbon Collective Investing, LLC (“Carbon Collective”), a climate change-focused online investment advisor, today announced the launch of the Carbon Collective Climate Solutions U.S. Equity ETF (CCSO), an actively managed exchange-traded fund that invests in publicly traded companies that are dedicated to solving climate change. Climate change poses a serious threat to society and more investment is needed in companies that are taking steps to reverse the deca

News for Carbon Collective Climate Solutions US Equity Etf ETF (CCSO)