5 min readBy Ron Koren ETF Insider
How does the KCAL ETF work?
The KCAL ETF is a specialized investment fund that focuses on a specific sector. This exchange-traded fund offers investors exposure to a range of companies in this sector.
The KCAL Active Food Security ETF is managed by KCAL, an experienced investment management firm. This actively managed exchange-traded fund seeks to achieve its investment objective by primarily investing in securities of Food Security Companies, as defined in its investment strategy. KCAL emphasizes a top-down approach, utilizing quantitative and qualitative factors to identify companies dedicated to food production and global food security infrastructure. Additionally, the fund considers global macroeconomic events and the long-term impacts of climate change on food production and prices when selecting investments. KCAL also recognizes the importance of water security in food security and invests in companies related to the water industry, particularly desalination plants. With a focus on food and agriculture industries, KCAL actively manages its portfolio to help investors navigate the challenges and opportunities within the global food supply chain.
The KCAL Dividend ETF focuses on companies within the Food Security sector. It actively manages its portfolio to allocate at least 80% of its net assets to Food Security Companies. These companies are defined as those with 50% of their assets or revenues tied to food production, distribution, or delivery, or those investing at least 50% of their capital expenditures in technology supporting global food security. While the ETF primarily aims for capital appreciation, it may also provide investors with dividends. The dividend distribution is influenced by the individual dividend policies and performances of the constituent companies within the food security sector, and these distributions typically occur on a regular basis.
Tracking the Global Food Security Companies is the primary objective of the KCAL Tracking ETF. This actively managed exchange-traded fund (ETF) strives to allocate at least 80% of its net assets to securities of Food Security Companies. These companies are defined as those with 50% of their assets invested in or 50% of their revenues derived from food production, distribution, or delivery, or those investing at least 50% of their capital expenditures in technology and tools related to global food security. KCAL Tracking may also invest in derivative instruments, particularly futures contracts on food and fertilizer, to align with its investment objective. The fund focuses on both the food and agriculture industries and the water industry, recognizing the vital role of water security in food security, making it a valuable option for investors seeking exposure to these sectors.
The correlation aspect of the Subversive Food Security ETF is not widely known, as specific data on its correlations with other assets or sectors is not readily available. However, investors can use ETF Insider's web app to study the correlations with its simple visualization tool, which can provide deep and interesting data for this ETF, helping investors make informed decisions. The tool also allows users to analyze any potential overlaps with other US ETFs, offering valuable insights into market trends and diversification strategies.
The KCAL Sector ETF focuses on investments in companies that are integral to the food security landscape. It seeks to allocate at least 80% of its net assets to Food Security Companies, which are businesses heavily involved in food production, distribution, and the technology that supports global food security. This ETF covers a broad spectrum, including fertilizer/potash companies, meat and food production industries, as well as industrial sector firms providing machinery and equipment for food production. Additionally, it considers global macroeconomic factors and the impact of climate change on food production, aiming to identify companies positioned to address inflationary shocks and supply-driven disruptions in the global food supply chain. Water security is also a focus, with investments in publicly traded desalination plants, recognizing the critical role of water in food security. Please note that the KCAL Sector ETF is non-diversified, concentrating its investments in the food and agriculture industries, which may entail higher risks associated with limited diversification.
The exposure characteristics of the KCAL ETF are focused on companies within the food security and agriculture sectors. KCAL seeks to invest in businesses that have at least 50% of their assets or revenues tied to food production, distribution, or delivery. Additionally, the fund may allocate its investments in companies within the industrials sector that provide essential machinery and equipment to support the global food security supply chain. KCAL also considers investments in the water industry, particularly in publicly traded desalination plants, as water security is intricately linked to food security. This ETF''s exposure provides an opportunity for investors to participate in the stability and growth potential of the global food supply chain.
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