Global X Metaverse ETF’s Process Pillar rating is just average, but a strong management team still helps this strategy retain its Morningstar Medalist Rating of Bronze. The portfolio maintains a sizable cost advantage over competitors, priced within the least expensive fee quintile among peers.  

 The team managing the passive strategy drives the strategy's Above Average People Pillar rating, following a recent upgrade from Low. The strategy earns an Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained an overweight liquidity exposure and momentum exposure compared with category peers. High liquidity exposure is attributed to stocks with a high trading volume, lending managers more flexibility. And low momentum exposure is rooted in holding stocks that are not currently on a winning streak and instead holding those that managers believe are undervalued. The strategy's parent organization is industry standard, albeit with some strong attributes like overall affordable fees, but is held back by a poor risk-adjusted track record. This earns the firm an Average Parent Pillar rating.

Analyst Rating

NVIDIA

Take-Two Interactive Software

Coinbase

Unity Software

Snap

Microsoft

Apple

Roblox

Amazon

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. Global X Metaverse 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. The depth of the portfolio management team also contributes to the process. With five portfolio managers, the fund is well-staffed. Lastly, the process is limited by the parent firm's five-year risk-adjusted success ratio of 38%. 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 subpar 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 provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Global X Metaverse Index.  The fund invests at least 80% of its net assets, plus the amount of any borrowings for investment purposes, and in the securities of the index and in American Depositary Receipts ("ADRs") and Global Depositary Receipts ("GDRs") based on the securities in the index. The index is designed to provide exposure to companies that are positioned to benefit from the development and commercialization of the metaverse. The fund is non-diversified. 

 The portfolio is overweight in communication services and financial services relative to the category average by 57.3 and 3.4 percentage points, respectively. The sectors with low exposure compared to category peers are technology and industrials, underweight the average by 52.9 and 2.8 percentage points of assets, respectively. The portfolio is positioned across 41 holdings and is quite concentrated. In particular, 59.4% of the strategy's assets are housed within the top 10 holdings, compared to the category average of 48.5%. And finally, in terms of portfolio turnover, this fund trades less frequently than the category’s average, potentially limiting costs to investors.

Average

Process

Global X Metaverse ETF benefits considerably from its team, earning it an Above Average People Pillar rating. There’s a deep bench of five managers listed on the fund. Overall, management experience is lacking on the team, with only an average of four years spent in the industry. Together, they manage a total of 104 strategies, with mixed prospects. The asset-weighted average Morningstar Medalist Rating across the strategies is Neutral. This means, in aggregate, they are not positioned to deliver positive alpha relative to the category median.  

 Note: This People Pillar rating is indirectly assigned by an analyst. Morningstar analysts evaluate the People Pillar for passive products at the brand level and may also differentiate by asset class. There is at least one other passive strategy at the firm that is covered by a Morningstar analyst, so the People Pillar rating of the fund is inherited from the rating that the Morningstar analyst assigned to investment vehicles under the same brand name.

Above Average

People

In a competitive industry, Global X doesn't differentiate itself enough, leading to an Average Parent Pillar rating. A strength of Global X is that its product shelf of open-end and exchange-traded funds is, on average, offered at a minimal cost, suggesting that it considers what's best for its investor base. On average, fees for funds are in the cheapest quintile of respective category peers. Looking at the firm's risk-adjusted performance, the product lineup compares similarly to competitors. Across its open-end and exchange-traded funds, the firm's average five-year Morningstar Rating is 2.5 stars. Global X's longest-tenured managers do not possess comparable experience as teams at other firms, a cause for concern. Specifically, average tenure within the firm is four years. As such, there is less confidence in the group's ability to manage capital through a full market cycle effectively.

Parent

Global X Metaverse ETF

VR tracks a market cap-weighted index of 40 global companies that derive revenue from or have primary business operations associated with the Metaverse. 

QUALCOMM

Verizon

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OLDWICK, N.J.--(BUSINESS WIRE)-- #insurance--AM Best has placed under review with developing implications the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a” (Excellent) of Validus Reinsurance, Ltd. (Validus Re) (Hamilton, Bermuda) and Validus Reinsurance (Switzerland) Ltd. (Zurich, Switzerland), a subsidiary of Validus Holdings, Ltd. (Validus) (Hamilton, Bermuda) [NYSE:VR]. Concurrently, AM Best has commented that the Credit Ratings (ratings).

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Autodesk

Match Group

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Intel

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News for Global X Metaverse ETF ETF (VR)