What were the Fund costs for the past year?
(based on a hypothetical $10,000 investment)
Fund Name | Costs of a $10,000 investment | Costs paid as a percentage of a $10,000 investment |
|---|---|---|
Acruence Active Hedge U.S. Equity ETF | $83 | 0.83% |
How did the Fund perform last year?
The Acruence Active Hedge U.S. Equity ETF ("XVOL") returned -0.58% (NAV) for the fiscal year ended March 31, 2025, underperforming the S&P 500 Total Return Index (SPXTR), which gained 8.25%.
Investment Strategy Update
XVOL's strategy targets exposure similar to a blended index of two distinct factors:
• U.S. Large Cap Momentum
• U.S. Large Cap Dividend Growth & Yield
Each component index selects up to 50 stocks, with the blended index combining the top 50 stocks by weight (normalized to 100). This dual-factor approach has historically provided more consistent returns by balancing growth and income-oriented exposures. While short-term performance lagged the broader market, the strategy is designed for long-term resilience, leveraging the complementary strengths of momentum and dividend growth. We remain confident in its potential to deliver risk-adjusted returns over time.
Additionally, XVOL maintains an allocation of approximately 1-2% to Volatility Call Spreads, designed to profit from large increases in market volatility. This tactical hedge helps mitigate risk during periods of market stress.
What Factors Influenced Performance?
The fiscal year presented several distinct market environments that impacted XVOL’s relative performance:
1. Strong Mega-Cap Leadership in Early 2024
The S&P 500 delivered robust returns, marking its second consecutive year with gains exceeding 20%, largely driven by the outsized performance of the “Magnificent Seven” mega-cap tech stocks.
While XVOL held some exposure to these names, its lower weightings—combined with its diversified factor approach—reduced participation in the market’s narrow leadership.
2. Late-Year Shift Toward Value Stocks
In the second half of the year, value stocks saw modest gains, but they lagged the tech-led growth rally.
XVOL’s blended strategy (momentum + dividend growth) helped balance exposure, but the Fund’s relative underweighting in the highest-flying growth stocks weighed on returns compared to the benchmark.
3. Market Correction
The final three months of the fiscal year (2025) have brought a sharp reversal from the prior year’s rally, with markets turning volatile amid rising macroeconomic uncertainty.
Key Takeaways
• The market’s heavy concentration in mega-caps created a challenging environment for diversified strategies like XVOL during 2024.
• The Fund’s volatility hedge (1-2% in call spreads) had limited impact in a generally low-volatility, upward-trending market.
The blended momentum/dividend growth approach has faced headwinds recently in 2025 as:
• Momentum stocks struggled amid rapid sector rotation.
• Dividend growers were weighed down by broader risk-off sentiment, though their relative defensiveness helped cushion losses.
While 2025’s volatility posed challenges, XVOL’s strategy is designed to adapt across market cycles:
• The volatility hedge remains a tactical tool for downside hedge.
• The dual-factor portfolio (momentum + dividend growth) aims to balance growth participation with resilience during pullbacks.
Cumulative Performance
(Initial Investment of $10,000)
Annual Performance
Average Annual Returns for the Periods Ended March 31, 2025 | 1 Year | Since Inception (4/21/2021) |
|---|---|---|
Acruence Active Hedge U.S. Equity ETF | -0.58% | 1.84% |
S&P 500® Total Return Index | 8.25% | 9.44% |
Key Fund Statistics
(as of March 31, 2025)
Fund Size (Thousands) | $3,499 |
Number of Holdings | 52 |
Total Advisory Fee Paid | $52,652 |
Annual Portfolio Turnover | 361% |
What did the Fund invest in?
(as of March 31, 2025)
Sector Breakdown
(% of total net assets)
Top Ten Holdings | (% of Total Net Assets) |
|---|---|
Broadcom, Inc. | |
MPLX LP | |
Heritage Financial Corp. | |
KeyCorp | |
Truist Financial Corp. | |
CME Group, Inc. - Class A | |
Altria Group, Inc. | |
Universal Corp. | |
OGE Energy Corp. | |
Carvana Co. |