Despite People Pillar weakness and an Average Process Pillar, Roundhill Ball Metaverse ETF gets enough right to retain its Morningstar Medalist Rating of Bronze. The portfolio maintains a sizable cost advantage over competitors, priced within the second-lowest fee quintile among peers.  

 The strategy receives an Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained an underweight position in momentum exposure and an overweight in liquidity exposure compared with category peers. 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 high liquidity exposure is rooted in stocks with higher trading volumes, lending managers more flexibility. The team managing this passive strategy earns a Low People Pillar rating. 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 overall attractive fees but is held back by a low success ratio across its lineup.

Analyst Rating

Roblox

Apple

NVIDIA

Microsoft

QUALCOMM

Snap

Autodesk

Amazon

Alphabet

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. Roundhill Ball Metaverse ETF earns an Average Process Pillar rating. The leading factor in the rating is that this fund tracks an index. Historical data, such as Morningstar's Active/Passive Barometer, finds that passively managed funds have generally outperformed their active counterparts, especially over longer time horizons. A low expense ratio, with costs ranking in its category's least expensive quintile, also influences the rating. Higher fees detract from net returns, which gives this fund an advantage over those with higher costs. Lastly, the process is limited by the parent firm's five-year risk-adjusted success ratio of 0%. 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 investment strategy as stated in the fund's prospectus is:  The investment seeks to track the performance, before fees and expenses, of the Ball Metaverse Index (the "index").  The index seeks to track the performance of globally-listed equity securities of companies that engage in activities or provide products, services, technologies, or technological capabilities to enable the Metaverse, and benefit from its generated revenues. "Metaverse" is a term used to refer to a future iteration of the Internet. Under normal circumstances, at least 80% of the fund's net assets will be invested in Metaverse Companies, and which may include investments in ADRs or SPACs. The fund is non-diversified. 

 The portfolio is overweight in communication services and consumer cyclical relative to the category average by 29.3 and 2.8 percentage points, respectively. The sectors with low exposure compared to category peers are technology and industrials, with technology underweighting the average portfolio by 26.9 percentage points of assets and industrials similar to the average. The portfolio is positioned across 47 holdings and is relatively top-heavy. Of the strategy's assets, 51.0% are concentrated within the top 10 holdings, as opposed to the category’s 48.2% average. And finally, in terms of portfolio turnover, this fund trades less regularly than the typical peer in its category, which may result in a lower cost to investors.

Average

Process

Roundhill’s team earns a Low People Pillar rating. The primary determinant of 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 holds the team back. Turnover at its parent firm further weakens the team. The firm's asset-weighted manager tenure of 41 years suggests that it could do more to retain portfolio managers.

People

Roundhill's track record as a steward is mixed, leading to an Average Parent Pillar rating. One area of strength is the firm’s favorable fees for open-end and exchange-traded funds, demonstrating a firm-wide commitment to minimizing costs and maximizing investors’ returns. Fees for funds are, on average, within the second-cheapest quintile of similarly distributed strategies. Roundhill strategies have failed to have lengthy success. In particular, the firm's five-year risk-adjusted success ratio demonstrates that only 0% have both survived and beaten their respective category median on a risk-adjusted basis. A low success ratio indicates poor performance and raises questions about a firm’s discipline around investment strategy and product development. With an average three-year Morningstar Rating of 1.7 stars, the risk-adjusted performance of Roundhill's open-end and exchange-traded funds falls short of competitors.

Parent

Roundhill Ball Metaverse ETF

The Roundhill Ball Metaverse ETF is an exchange-traded fund incorporated in the US. The fund seeks to track the performance of the Ball Metaverse Index, which is comprised of leading companies across major categories of the Metaverse.  “Metaverse” is a concept of a next-gen Internet that’s persistent, interoperable, synchronous, and open to everyone, with its own fully functioning economy and both virtual and real-world experiences. 

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FRANKFURT, Germany , March 11, 2022 /PRNewswire/ -- Roundhill Investments, an ETF sponsor focused on innovative thematic funds, is planning to launch a Metaverse ETF in Germany later this month in partnership with Ball Metaverse Research Partners. The Fund will be Roundhill's first launch in the European market.

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NEW YORK, Feb. 7, 2022 /PRNewswire/ --  Roundhill Investments today announced that effective February 4, 2022, the management fee paid by the Roundhill Ball Metaverse ETF (the "Fund") to Roundhill Investments has been reduced from 0.75% to 0.59% of the Fund's average daily net assets. No action is required by current shareholders of the Fund as a result of this change.

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NEW YORK, Nov. 17, 2021 /PRNewswire/ -- Roundhill Investments, an ETF sponsor focused on offering innovative thematic funds, is pleased to announce that META — the Roundhill Ball Metaverse ETF — surpassed $500 million in assets under management this week. META crossed this milestone just two weeks after reaching $250 million.

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Fastly

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NEW YORK, Nov. 8, 2021 /PRNewswire/ -- Roundhill Investments , an ETF sponsor focused on offering innovative thematic funds, is pleased to announce that META — the Roundhill Ball Metaverse ETF — surpassed $250 million in assets under management last week. META crossed $50 million in six weeks, $100 million in nine, and this latest milestone in 18 weeks.

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