Kevin O’Leary says “Thanks a Billion,” as AUM Passes $1.0 Billion for O’Shares ETFs, While Posting a Strong Five-year Track Record for its Flagship ETF, OUSA.
September 22, 2020 – Boston, MA – O’Shares ETFs announced AUM across its set of ETFs growing past $1.0 billion, while posting a strong five-year track record for its flagship ETF, OUSA (O’Shares U.S. Quality Dividend ETF). Since inception in July 2015, OUSA generated 10.9% annualized, outperforming value1 that generated 5.9%, as of 8/31/2020. View the standardized performance for OUSA.
With the economy in recession, equity income investors may be at risk of dividend cuts or suspensions in their portfolios. Dividend quality matters more today than it has in a long time. OUSA holds approximately 100 dividend paying stocks, selected for profitability, strong balance sheets and dividend quality. Investors are using OUSA to gain exposure to high quality U.S. large-cap companies that have strong dividend growth and coverage2, increasing the likelihood that they will be able to maintain and grow dividends paid to investors even during periods of economic uncertainty.
“We thank the advisors and investors who’ve chosen our ETFs, including OUSA, one of the best dividend strategies I’ve ever seen. Just check the performance and the portfolio. It has stocks with strong profits, strong balance sheets, and strong dividend growth. OUSA also has no energy stocks or REITs, which I’m happy not to own in this economy. Instead, OUSA has the stocks I want as we go through these tough times. I’m also invested in our quality dividend strategies for small caps using OUSM, and for Europe using OEUR, which gives me diversification and a way to own some great global companies. After lagging a few years, it could soon be time for stronger performance from small caps and Europe,” said Kevin O’Leary, Chairman of O’Shares ETFs.
“We think quality dividend strategies are more attractive than generic dividend strategies, going through the 2020 recession. Although the Fed has given the markets major support, when that fades some investors might be caught sleeping. The World Bank forecasts this recession will be the worst since World War II.3 Already in 2020, markets have been tough on generic dividend strategies, because they own all the dividend stocks, essentially all those that are cutting dividends. Of the dividend-paying stocks in the S&P 500, approximately 12% have announced either a cut or suspension for their next future dividend.4 Leverage in the market has increased over the past few years which may put further pressure on companies that pay a dividend. Our research shows a performance advantage for stocks with strong ROA (Return on Assets)5 and strong cash flow to debt. You might wonder why investors would ever want to own the stocks with weak profits and bad balance sheets. We believe quality wins. Feedback from our distribution team is that advisors and investors have been pleased that OUSA has captured less downside than the market in stress events, yet still captured a significant portion of the upside,” said Connor O’Brien, CEO of O’Shares ETFs
O’Shares ETF Investments
O’Shares Investments provides ETFs for long-term wealth management, with an emphasis on quality across our family of ETFs. The O’Shares ETFs are designed for investors with objectives ranging from wealth preservation and income to growth and capital appreciation. Each O’Shares ETF reflects our rules-based investment philosophy, including quality as an important characteristic. O’Shares ETFs are all managed according to rules-based indexes, and all are listed on the New York Stock Exchange.
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- Value: Represented by Russell 1000 Value Index. Measures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.
- Coverage: Ratio which shows whether the company generates enough earnings for dividend payout.
- COVID-19 to Plunge Global Economy into Worst Recession since World War II
- Source: Bloomberg Finance L.P. Data retrieved 9/9/2020.
- ROA (Return on Assets): Indicator of how profitable a company is relative to its Total assets, in percentage. Calculated as (Trailing 12M Net Income/ Average Total Assets) x 100.
Performance data quoted represents past performance and is no guarantee of future results. Current performance may be lower or higher than the performance data quoted. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than original cost. Returns less than one year are not annualized. For most recent month end performance, please visit oshares.com.
The outbreak of COVID-19 has negatively affected the worldwide economy, individual countries, individual companies and the market in general. The future impact of COVID-19 is currently unknown, and it may exacerbate other risks that apply to the Fund.
Before you invest in O’Shares ETF Investments Funds, please refer to the prospectus for important information about the investment objectives, risks, charges and expenses. To obtain a prospectus containing this and other important information, please view or download a prospectus. Read the prospectus carefully before you invest. There are risks involved with investing including the possible loss of principal.
Concentration in a particular industry or sector will subject the Funds to loss due to adverse occurrences that may affect that industry or sector. The Funds may use derivatives which may involve risks different from, or greater than, those associated with more traditional investments. A Fund's emphasis on dividend-paying stocks involves the risk that such stocks may fall out of favor with investors and underperform the market. Also, a company may reduce or eliminate its dividend after the Fund's purchase of such a company's securities. Returns on investments in foreign securities could be more volatile than, or trail the returns on, investments in U.S. securities. Exposures to foreign securities entail special risks, including political, diplomatic, economic, foreign market and trading risks. In addition, a Fund's investments in securities denominated in other currencies could decline due to changes in local currency relative to the value of the U.S. dollar, which may affect the Fund's returns. See the prospectus for specific risks regarding the Funds.
The securities of small capitalization companies are often more volatile and less liquid than the stocks of larger companies and may be more affected than other types of securities during market downturns. Compared to larger companies, small capitalization companies may have a shorter history of operations, and may have limited product lines, markets or financial resources.
Companies involved with Internet technology and e-commerce are exposed to risks associated with rapid advances in technology, obsolescence of current products and services, the finite life of patents and the constant threat of global competition and substitutes.
Past performance does not guarantee future results. Shares are bought and sold at market price (not NAV), are not individually redeemable, and owners of Shares may acquire those Shares from the Funds and tender those shares for redemption to the Funds in Creation Unit aggregations only, consisting of 50,000 Shares. Brokerage commissions will reduce returns. The market price of Shares can be at, below, or above NAV. Market Price returns are based upon the midpoint of the bid/ask spread at 4:00 PM Eastern time (when NAV is normally determined), and do not represent the returns you would receive if you traded Shares at other times.
O’Shares ETF Investments Funds are distributed by Foreside Fund Services, LLC. Foreside Fund Services, LLC is not affiliated with O’Shares ETF Investments or any of its affiliates.