If 2024 was the story of the AI macrotrend, with AI set to upend not only technology companies but almost every part of the economy, what other macrotrends deserve a look? As political and economic shifts around the world continue to grow, investors may want to revisit the impact of shifting supply chains. Supply chains undergird nearly every aspect of the global economy, and a long-term shift offers numerous, significant opportunities. That’s were an active macrotrend ETF like SUPP can play a role.
The TCW Transform Supply Chain ETF (SUPP ), launched in February 2023. The active ETF takes a high-conviction approach to U.S. equities both driving and benefiting from supply chain changes. For example, the fund and its managers target those companies relocalizing supply chains and leaning into automation and innovation.
Specifically, the active macrotrend ETF invests in firms reshoring their manufacturing capabilities, improving supply chain transportation, and innovating with automation for certain business functions. Leaning on fundamental research and proprietary analysis, SUPP invests in 20-60 names.
Together, that approach has helped SUPP return 20.2% over the last one-year period. That performance saw the ETF beat both its ETF Database Category and FactSet Segment averages. The strategy more than doubled the performance of the former and far outpaced the latter average in that time frame.
Should U.S. policy indeed shift toward a more domestic focus and away from globalization, SUPP could intrigue. Either way, the active macrotrend ETF’s focus on supply chain changes writ large make it a compelling fund to watch. Its active approach can empower its managers to adapt to events as needed, while also looking to outperform more staid index funds. Charging 75 basis points, the strategy could provide a strong addition to a satellite ETF roster for investor portfolios.
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