4 min readBy Ron Koren ETF Insider
How does the OSEA ETF work?
The OSEA 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 O'Shares Global Internet Giants ETF (OSEA) is managed by O'Shares Investments, a firm dedicated to providing innovative ETF solutions. Founded by CNBC contributor and financial expert Kevin O'Leary, O'Shares Investments focuses on designing ETFs that cater to specific investment objectives. OSEA aims to provide investors with exposure to global internet giants, offering a unique opportunity to invest in companies leading the digital transformation across the globe. O'Shares Investments utilizes a robust selection process, emphasizing factors such as quality, low volatility, and strong ESG considerations to construct a portfolio of internet giants poised for long-term growth. With OSEA, investors can access a diversified basket of stocks from the dynamic world of internet technology.
The OSEA Dividend ETF primarily focuses on investing in equity securities of non-U.S. companies, with an emphasis on those in emerging market countries. It seeks to build a portfolio of companies identified as compounders by its subadvisor, C WorldWide Asset Management Fondsmaeglerselskab A/S. These companies are expected to demonstrate sustainable growth and the ability to compound their earnings over the long term, typically five years or more. The ETF's dividend distribution is influenced by the dividend policies and performance of its constituent companies. While OSEA Dividend may not be primarily oriented toward dividends, investors can potentially benefit from both capital appreciation and some level of dividend returns.
Tracking the investment strategy of OSEA ETF involves primarily investing in equity securities of non-U.S. companies, particularly those located in emerging market countries. The fund focuses on companies with market capitalizations of at least $5 billion at the time of acquisition that are identified as compounders by C WorldWide Asset Management Fondsmaeglerselskab A/S, the ETF's subadvisor. A compounder is a company expected to experience sustainable growth and compound its earnings over the long-term. To identify suitable investments, the subadvisor conducts qualitative assessments, evaluating factors such as a company's business model, management, financial metrics, and environmental, social, and governance (ESG) considerations. The goal is to construct a portfolio of high-quality companies exposed to diverse structural growth themes, resulting in a portfolio of 25-30 companies, with occasional variations in country, region, or sector allocations based on the subadvisor's stock selection process. Additionally, the subadvisor integrates ESG factors into its investment process, aiming to identify sustainable growth companies with strong corporate governance practices and ethical foundations. OSEA ETF's strategy is based on fundamental research, with a focus on a long-term investment horizon, but it also allows flexibility to make investment decisions based on changing factors or alternative investment opportunities.
The correlation aspect of the O'Shares Global Internet Giants ETF (OSEA) is essential for investors looking to understand its performance in relation to the global internet industry. OSEA primarily invests in equity securities of non-U.S. companies, particularly those in emerging markets, with a focus on identifying sustainable growth companies known as compounders. As a result, its correlation is influenced by the performance of the global internet sector and the countries and regions it invests in. Investors often analyze OSEA's correlation with the broader technology sector, emerging market indices, and other relevant benchmarks to assess its risk and return characteristics. OSEA's portfolio construction, which typically includes 25-30 high-quality companies with strong ESG considerations, contributes to its unique correlation profile. To gain deeper insights into OSEA's correlations and overlaps, investors can utilize ETF Insider's web app, which offers comprehensive data visualization tools for studying correlations and making informed investment decisions.
The OSEA ETF focuses primarily on investing in equity securities of non-U.S. companies, with a significant emphasis on emerging market countries. This ETF primarily targets companies with market capitalizations exceeding $5 billion, identified as compounders by C WorldWide Asset Management Fondsmaeglerselskab A/S, the ETF's subadvisor. Compounders are companies expected to sustain long-term growth and compound their earnings over at least five years. The ETF's investment strategy involves qualitative assessments, considering factors such as business models, management quality, financial metrics, and valuation. OSEA aims to construct a portfolio exposed to diverse structural growth themes, typically comprising 25-30 companies. The subadvisor also incorporates environmental, social, and governance (ESG) factors into its investment process, seeking sustainable growth companies with strong corporate governance practices. OSEA Sector's approach is rooted in fundamental research, including risk-return assessments, market sentiment analysis, and economic data, and it may invest in depositary receipts and foreign currencies for investment or hedging purposes. The ETF is classified as non-diversified, allowing it to invest in a smaller number of issuers, and it maintains a long-term investment horizon.
The exposure characteristic of the OSEA ETF highlights its focus on non-U.S. companies, particularly those in emerging market countries. This ETF primarily invests in the equity securities of companies with market capitalizations of at least $5 billion, identified as compounders by C WorldWide Asset Management Fondsmaeglerselskab A/S, the Fund''s subadvisor. Compounders are companies expected to experience sustainable growth and compound their earnings over the long term. The ETF seeks high-quality companies with consistent, recurring revenues, stable free cash flows, and sustainable returns on invested capital, aiming to construct a portfolio of companies exposed to diverse structural growth themes. Country, region, and sector allocations are determined through the subadvisor''s stock selection process, which also incorporates environmental, social, and governance (ESG) factors. The investment process generally results in a portfolio of 25-30 companies, with the flexibility to make more substantial investments in specific countries, regions, or sectors when deemed appropriate. OSEA ETF is non-diversified, allowing it to invest in a smaller number of issuers.
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