The combination of a middling Process Pillar rating and a Below Average People Pillar rating limit  ProShares Supply Chain Logistics ETF to a Morningstar Medalist Rating of Neutral.  The portfolio maintains a cost advantage over competitors, priced within the second-lowest fee quintile among peers.  

 The team managing the passive 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 quality exposure compared with category peers. High liquidity exposure is attributed to stocks with a high trading volume, lending managers more flexibility. And a high quality exposure is rooted in holding stocks with low financial leverage and strong returns on equity. 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 low fees but is held back by a cohort of unseasoned portfolio managers.

Analyst Rating

Old Dominion Freight Line

FedEx

Union Pacific

Expeditors International of Washington

American Shared Hospital Services

Canadian Pacific Railway

Saia

XPO Logistics

Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category benchmark on a risk-adjusted basis over the long term. ProShares Supply Chain Logistics ETF earns an Average Process Pillar rating. The leading factor in the rating is that this fund tracks an index. Historical data, like Morningstar's Active/Passive Barometer, finds that passively managed funds have generally outperformed their active counterparts, especially over longer time horizons. Management team experience, which averages 16 years at this fund, also strengthens the process. Lastly, the process is limited by the parent firm's five-year risk-adjusted success ratio of 43%. 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 results, before fees and expenses, that track the performance of the FactSet Supply Chain Logistics Index (the “Index”).  The fund invests in financial instruments that ProShare Advisors believes should track the performance of the index. The index provider then selects into the index the 40 largest companies, by market capitalization, and that generate 75% or more of their revenue from products or services produced or provided by one or more of the applicable RBICS Sub-Industries. The fund will invest at least 80% of its net assets in the securities that comprise the index. It is non-diversified. 

 The portfolio has allocations in its top two sectors, consumer cyclical and industrials, that are similar to the category. The sectors with low exposure compared to category peers are technology and basic materials; however, the allocations are similar to the category. The portfolio is composed of 51 holdings and is less top-heavy than peers. Specifically, 45.7% of the portfolio's assets are concentrated within the top 10 fund holdings, as opposed to the category’s 70.5% average. And in closing, in terms of portfolio turnover, this portfolio turns over its holdings less quickly than peers, potentially leading to lower costs for investors and eliminating a drag on performance.

Average

Process

ProShares’s team receives a Below Average People Pillar rating. The team is supported by the strategy's fees, which rank in its category's second least expensive fifth. Fees detract from net returns, so the team has a lower expense hurdle to overcome. However, the rating is weakened by the parent firm's five-year success ratio of 36%. The measure indicates the percentage of a firm's funds that survived and beat 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 58% also holds the team back.

Below Average

People

In a competitive industry, ProShares doesn't differentiate itself enough, 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. Longest-tenured managers’ average asset-weighted tenure within the firm is ten years, bringing a wealth of knowledge through a complete market cycle and ultimately contributing positively to the rating. Despite other redeeming qualities as a firm, ProShares has seen some disruption among its portfolio management ranks in the past five years, denoted by elevated turnover compared to peer asset-management firms. Long-term stability tends to support positive results.

Parent

Proshares Supply Chain Logistics ETF

SUPL tracks a market-cap-weighted index of companies involved in the supply chain logistics of raw materials, intermediate goods, and finished products around the globe.

First Trust Nasdaq Transportation ETF

iShares Transportation Average ETF

Qraft AI-Enhanced US Next Value ETF

Pacer Industrials and Logistics ETF

FedEx (FDX) topped earnings estimates but missed on revenues. It provided upbeat guidance for the fiscal year despite the ongoing demand weakness.

ETFs to Gain on FedEx Q1 Earnings Beat

FedEx (FDX) topped earnings estimates but missed on revenues. It provided weak guidance for the fiscal year on ongoing demand weakness and input cost inflation.

ETFs in Focus Post Mixed Q4 FedEx Earnings

AdvisorShares Drone Tech ETF

FedEx (FDX) topped earnings estimates and lifted its full-year outlook when it reported its third-quarter fiscal 2023 results.

FedEx Raises Outlook, Shares Jump: ETFs to Tap the Strength

Engine No 1 Transform Supply Chain ETF

The actively managed fund focuses on companies that are improving their own or others' supply chains.

Engine No. 1 ETF Targets Supply Chain Resilience

ProShares Equities for Rising Rates ETF

ProShares S&P 500 Dividend Aristocrats ETF

ProShares S&P MidCap 400 Dividend Aristocrats ETF

ProShares Russell 2000 Dividend Growers ETF

The key question of 2023 — will there be a hard or soft-landing — depends very much on which economy one is looking at: the goods economy or the service economy.

2023 Market Outlook: A Tale of Two Economies

American Customer Satisfaction ETF

The transport bellwether FedEx (FDX) delivered disappointing first-quarter fiscal 2023 results. The courier company missed both earnings and revenue estimates.

FedEx Fiscal Q1 Earnings Disappoints: ETFs in Focus

FedEx missed on earnings but beat the revenue estimates. The parcel company issued a stronger-than-expected full-year forecast for fiscal 2023.

FedEx Earnings Puts ETFs in Focus

The ProShares Supply Chain Logistics ETF trades under the ticker symbol SUPL and offers exposure to 40 shipping, railroad, air cargo, trucking, technology and brokerage companies that make up the FactSet Supply Chain Logistics Index.

ProShares launches Supply Chain Logistics ETF

ProShares has launched a new ETF offering investors the opportunity to benefit from fundamental changes to the supply chain. The ProShares Supply Chain Logistics ETF (SUPL), listed on the NYSE on April 7 with a 58 basis point expense ratio, is designed to give investors access to companies involved in each point of the process [.

ProShares Launches SUPL, Offering Investors Exposure to the Supply Chain

BETHESDA, Md.--(BUSINESS WIRE)--ProShares launches a Supply Chain Logistics ETF (SUPL) to provide investors end-to-end exposure to companies that move global trade forward.

News for Proshares Supply Chain Logistics ETF ETF (SUPL)