Strategy Shares Bets on Monopolies with New ETF
- The new Monopoly ETF (MPLY) targets companies with monopolistic or oligopolistic attributes.
- Strategy Shares is expanding its lineup to four ETFs with distinctive investment approaches.
- The firm's flagship fund HNDL manages over $680 million with a 7% distribution target.
Strategy Shares launched the Monopoly ETF (MPLY) on Wednesday, seeking to provide long-term capital appreciation by investing in companies that demonstrate monopolistic attributes, according to a Tuesday Securities and Exchange Commission filing.
The fund is the latest addition to Strategy Shares's product lineup, focusing on companies with market-dominating positions at a time when investors are looking for ways to navigate market uncertainty through specialized investment themes.
The new fund, which will trade on the Cboe BZX Exchange under ticker MPLY, will focus on companies that either individually dominate a market with limited competition or collectively dominate with one or more other companies in an oligopoly structure, according to the fund's prospectus.
"Such characteristics typically allow these companies to earn substantial economic rents, maintain robust pricing power, and sustain strong revenue and earnings growth over time," the filing states.
The actively managed ETF will charge a management fee of 0.79% and will be sub-advised by Rareview Capital LLC, with Neil Azous serving as portfolio manager. The fund is expected to hold approximately 75 to 125 companies and may have large exposure to specific sectors, particularly information technology.
MPLY Seeks Market Dominators
Companies will be selected based on qualitative analysis of monopolistic attributes, such as brand dominance, regulatory exclusivity, industry concentration, historical antitrust reviews and pricing power, according to the filing. The fund will also consider quantitative metrics, including revenue growth, profit margins, return on investment and earnings per share.
The ETF will invest in both U.S. and non-U.S. companies with market capitalizations of at least $2 billion that trade on U.S. exchanges, including through American depositary receipts, the prospectus states. The portfolio will be predominantly market-cap weighted, though the sub-advisor will have discretion to determine final weightings.
The new fund will join Strategy Shares's existing lineup of three ETFs, which includes the Strategy Shares Nasdaq 7HANDL Index ETF (HNDL), the firm's flagship fund with $680.5 million in assets under management, according to FactSet data. HNDL has returned just under 1% year to date, and targets a 7% annualized distribution rate paid monthly.
The firm's other ETFs include the Strategy Shares Gold Enhanced Yield ETF (GOLY), which has $33.2 million in assets and has returned 14.9% year to date, according to FactSet. GOLY seeks total returns through a combined exposure of USD-denominated fixed-income securities, gold and commodities-based derivatives, according to Strategy Shares.
The Strategy Shares Robust Momentum ETF (ROMO), with $34.6 million in assets, has declined 2.9% year to date, FactSet data show. ROMO is a passively managed fund-of-funds that shifts exposure to global equities regionally or U.S. Treasurys based on momentum and trend signals, according to the firm.
