Nicholas Fixed Income Alternative ETF's Average Process Pillar and People Pillar ratings result in a Morningstar Medalist Rating of Neutral. The strategy charges fees in line with its similarly distributed peers, priced within the middle quintile.  

 The strategy merits an Average Process Pillar. This management team has a wealth of experience, but still gets an Average People Pillar rating. The strategy's parent firm has some investor-friendly attributes, like high portfolio manager retention and overall affordable fees. As a result, the firm gets an Average Parent Pillar rating.

Analyst Rating

Morningstar's evaluation of this fund's process seeks to understand management's investment philosophy, and whether it has been applied consistently over time and can add value across the market cycle. Nicholas Fixed Income Alternative ETF earns an Average Process Pillar rating.    The most important driver of the rating is the firm's five-year retention rate of 100% over the period. The size of the portfolio management team also supports the process. With four portfolio managers, the fund is reasonably well-resourced. Lastly, the process is limited by being an actively managed strategy. Historical data, such as Morningstar's Active/Passive Barometer, finds that actively managed funds have generally underperformed their passive counterparts, especially over longer time horizons.

 The investment strategy as stated in the fund's prospectus is as follows: 


The investment seeks current income.  Under normal circumstances, the fund will invest at least 80% of its net assets, plus borrowings for investment purposes, in U.S. Treasury fixed income securities. he Fund typically writes index put options and call options with weekly, monthly, and quarterly expirations. The fund will generally have up to ten credit spreads at any given time, and with up to 20% exposure to a single ETF or index credit spread (measured at the time of purchase). It is non-diversified.

 This strategy has a 5.7% 12-month yield, higher than its average peer's 4.9%. Higher yields tend to indicate higher credit risk.

Average

Process

Nicholas Fixed Income Alternative ETF earns an Average People Pillar rating. The number one contributor to the rating is the firm's five-year retention rate of 100%. The size of the portfolio management team also strengthens the rating. With four portfolio managers, the fund is reasonably well-resourced. Lastly, the rating is limited by the combined average five-year excess return of each manager, which indicates that the funds they manage have trailed their respective category average.


David O. Nicholas, the longest-tenured manager on the strategy, provides strong guidance, offering over 25 years of listed portfolio management experience. The average Morningstar Rating of the strategies they manage is 4.0 stars, demonstrating excellent risk-adjusted performance versus category peers.

People

Since its inception one year ago, Nicholas Wealth Management has demonstrated that it will hold its own as a steward of capital, warranting an Average Parent Pillar rating. Nicholas Wealth Management currently manages one vehicle, with a total of $64.2 million under management and a bench of four fund managers. Even though Nicholas Wealth Management is a relatively new firm, it has brought on experienced managers, averaging 17 years of total industry experience. The second part of recruiting experienced managers is retaining them, and so far, Nicholas Wealth Management has done this well, denoted by a low manager turnover ratio. 

 The firm’s relatively inexpensive 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 second-lowest quintile of firms.  

 To maintain an Average rating, Nicholas Wealth Management will be expected to uphold a consistent track record of positive investor experience.

Parent

Nicholas Fixed Income Alternative ETF

FIAX is an actively managed fund that seeks to provide income by holding a short-term portfolio of US Treasury securities and using a vertical option spread strategy across multiple asset classes.

ATLANTA, Dec. 20, 2023 (GLOBE NEWSWIRE) -- Nicholas Wealth today announced a 7.01% distribution yield, up from 6.56%, for the Nicholas Fixed Income Alternative ETF (FIAX). The dividend is payable on 12/19/2023 to shareholders of record at the close of trading day on 12/14/2023.

Nicholas Wealth Announces Increased Distribution Yield on FIAX ETF

ATLANTA , Nov. 14, 2023 /PRNewswire/ -- Nicholas Wealth Management's first actively managed exchange-traded fund (ETF), the Nicholas Fixed Income Alternative ETF (NYSE: FIAX) hit $50 million in assets in less than 12 months in existence. "This is such a tremendous milestone for our fund" said David Nicholas, Portfolio Manager of FIAX.

Nicholas Fixed Income Alternative ETF (Ticker: FIAX) Hits $50M in Assets

ATLANTA , Aug. 23, 2023 /PRNewswire/ -- Chief Executive Officer and Founder of Nicholas Wealth Management, David Nicholas will ring The Opening Bell® at the New York Stock Exchange (NYSE) on Thursday, August 24, 2023, at 9:30 AM. The New York Stock Exchange welcomes Nicholas Wealth Management to the podium to celebrate the recent listing of their Nicholas Fixed Income Alternative ETF (NYSE: FIAX).

David Nicholas of Nicholas Wealth Management to Ring The Opening Bell® At The New York Stock Exchange

MARIETTA, Ga., Aug. 22, 2023 (GLOBE NEWSWIRE) -- Nicholas Wealth today announced distributions on the Nicholas Fixed Income Alternative ETF (FIAX):

Nicholas Wealth Announces Distribution on FIAX ETF

Well-informed advisors are now well aware of the yields available in Treasuries, a trend that is not likely to go anyway anytime soon so long as the Fed is raising rates.

News for Nicholas Fixed Income Alternative ETF ETF (FIAX)