DoubleLine Shiller CAPE U.S. Equities ETF (CAPE) Fund Overview

DoubleLine Shiller CAPE U.S. Equities ETF (CAPE) Financial Services Profile

The DoubleLine Shiller CAPE U.S. Equities ETF (CAPE) provides exposure to U.S. equity sectors, tracking an index that identifies four undervalued and momentum-driven sectors monthly. It leverages the Cyclically Adjusted Price Earnings (CAPE) ratio for sector valuation, positioning itself in the smart beta ETF space with a value-oriented, rules-based strategy.

What Is the Investment Thesis for CAPE?

The DoubleLine Shiller CAPE U.S. Equities ETF (CAPE) presents an investment thesis centered on its distinctive rules-based, smart beta strategy, which seeks to capitalize on cyclically adjusted value and price momentum within U.S. equity sectors. With a market capitalization of $0.26 billion and a Beta of 0.82, indicating lower volatility relative to the broader market, CAPE tracks the Shiller Barclays CAPE US Core Sector Index. This index's methodology involves monthly identification of the four most appealing U.S. equity sectors based on relative undervaluation, determined by the Cyclically Adjusted Price Earnings (CAPE) ratio, and strong positive price momentum. A key value driver is the systematic application of a proven academic valuation metric (CAPE ratio) combined with a tactical momentum overlay, aiming to provide exposure to sectors with favorable characteristics. Growth catalysts include potential shifts in market cycles favoring value investing, increased adoption of transparent smart beta strategies by institutional and retail investors, and the inherent diversification benefits of monthly sector rotation, which can mitigate concentration risk. However, investors must consider the risk of underperformance during extended periods where growth stocks dominate the market, as CAPE's value-centric approach may lag. Monitoring the fund's tracking error against its benchmark and its performance relative to other value-focused ETFs and broader market indices is crucial for assessing its effectiveness and alignment with investment goals. The ETF does not pay a dividend.

Based on FMP financials and quantitative analysis

CAPE Key Highlights

Market Capitalization: $0.26 billion, reflecting its current scale within the ETF market.

• Beta: 0.82, indicating lower historical volatility compared to the overall market.
• Dividend Policy: Does not distribute dividends, aligning with its growth-oriented index tracking.
• Investment Strategy: Employs a rules-based approach tracking the Shiller Barclays CAPE US Core Sector Index.
• Sector Selection: Monthly identifies four U.S. equity sectors based on undervaluation (CAPE ratio) and price momentum.

Who Are CAPE's Competitors?

CAPE is benchmarked below against 8 industry peers on price, market cap, and our AI MoonshotScore.

AI Score by Stock Expert AI · Price data: FMP / Yahoo Finance

What Are CAPE's Key Strengths?

Rules-based, systematic investment approach provides transparency and discipline.

• Utilizes the academically recognized Shiller CAPE ratio for value identification.
• Monthly sector rotation strategy offers diversification and potential risk mitigation.
• Combines value and momentum factors, aiming to capture multiple sources of potential return.

What Are CAPE's Weaknesses?

Potential for underperformance during prolonged periods when growth stocks are favored over value.

• Reliance on the CAPE ratio may not always align with short-term market dynamics.
• Subject to tracking error, where ETF performance may deviate from its underlying index.
• Smaller market capitalization ($0.26B) compared to larger, more established ETFs.

What Are the Key Risks for CAPE?

Underperformance during prolonged periods where growth stocks significantly outperform value stocks, potentially leading to investor dissatisfaction.

• Tracking error between the ETF's performance and its underlying index, which could be influenced by expenses, rebalancing costs, or market liquidity constraints.
• Reliance on the CAPE ratio, which, despite its academic rigor, may not always align with short-term market dynamics or immediate investor preferences.
• Increased competition from other smart beta or value-focused ETFs, potentially leading to fee pressure and challenges in attracting and retaining assets.
• Changes in overall market conditions or economic cycles that diminish the effectiveness of momentum or value factors, impacting the strategy's efficacy.

What Threats Does CAPE Face?

• Intense competition from a growing number of smart beta and value-focused ETFs.
• Market conditions that diminish the effectiveness of value or momentum factors.
• Regulatory changes impacting the structure or operation of ETFs.
• Periods of high market volatility that could challenge the effectiveness of systematic sector rotation.

What Are CAPE's Competitive Advantages?

• Proprietary index methodology: Leverages the unique Shiller Barclays CAPE US Core Sector Index, based on Nobel laureate Robert Shiller's CAPE ratio.
• Rules-based, systematic approach: Provides transparency and removes discretionary human bias in monthly sector selection and rebalancing.
• Diversification and risk mitigation: Monthly rotation across four distinct sectors potentially reduces concentration risk compared to static or market-cap-weighted portfolios.
• Established brand association: Benefits from the credibility and academic recognition associated with the 'Shiller CAPE' name in investment circles.

What Does CAPE Do?

The DoubleLine Shiller CAPE U.S. Equities ETF (CAPE) operates within the asset management sector, offering investors a unique, rules-based approach to U.S. equity exposure. Established to mirror the performance of the Shiller Barclays CAPE US Core Sector Index, net of expenses, CAPE employs a systematic strategy designed to identify and allocate capital to what it deems the four most appealing U.S. equity sectors each month. This sophisticated selection process is rooted in two fundamental criteria: identifying sectors that are relatively undervalued and those demonstrating strong positive price momentum. Central to CAPE's methodology is the Cyclically Adjusted Price Earnings (CAPE) ratio, a valuation metric popularized by Nobel laureate Robert Shiller. The ETF utilizes this ratio to conduct a monthly, comprehensive valuation assessment across nine distinct sectors within the S&P 500 universe. This rigorous analysis allows the fund to pinpoint sectors that exhibit relative undervaluation, providing a disciplined framework for capital allocation. By integrating both value and momentum factors, CAPE aims to capture potential upside from sectors poised for recovery while also participating in ongoing market trends. Positioned within the burgeoning smart beta ETF space, CAPE differentiates itself through its explicit focus on value-oriented strategies, driven by a transparent, rules-based index. This approach potentially offers diversification across sectors, aiming to mitigate concentration risk often associated with traditional market-capitalization weighted indices. While its reliance on the CAPE ratio is a core strength for long-term value identification, the fund's performance may diverge from broader market indices, particularly during periods when growth stocks are predominantly favored. Investors considering CAPE are encouraged to evaluate its tracking error and performance against both wider market benchmarks and other value-focused ETFs to fully understand its risk-reward profile and strategic alignment with their investment objectives. The ETF's headquarters are located in Tampa, US, reinforcing its presence in the U.S. financial landscape.

What Products and Services Does CAPE Offer?

• Tracks the performance of the Shiller Barclays CAPE US Core Sector Index.
• Identifies the four most appealing U.S. equity sectors each month for investment.
• Selects sectors based on being relatively undervalued, utilizing the CAPE ratio.
• Also selects sectors demonstrating strong positive price momentum.
• Performs a monthly valuation assessment across nine distinct S&P 500 sectors.
• Provides exposure to U.S. equity sectors through a rules-based, systematic strategy.
• Aims to mitigate concentration risk through its diversified sector rotation approach.

How Does CAPE Make Money?

• Generates revenue primarily through management fees charged to investors as a percentage of assets under management (AUM).
• Attracts investors by offering a transparent, rules-based strategy that corresponds to the Shiller CAPE® U.S. Equity Index.
• Benefits from increased AUM as its investment strategy gains traction and demonstrates competitive performance within the smart beta space.

What Industry Does CAPE Operate In?

The DoubleLine Shiller CAPE U.S. Equities ETF (CAPE) operates within the dynamic and competitive asset management industry, specifically carving out a niche in the smart beta ETF segment. This segment has witnessed significant growth as investors increasingly seek systematic, rules-based strategies that offer potential for enhanced returns or improved risk profiles compared to traditional market-cap-weighted indices. CAPE's positioning is rooted in its value-oriented approach, leveraging the Cyclically Adjusted Price Earnings (CAPE) ratio and price momentum to select U.S. equity sectors. This aligns with a broader industry trend towards factor investing, where specific characteristics like value, momentum, size, and quality are targeted. The competitive landscape includes numerous other smart beta ETFs, actively managed value funds, and broad market index funds. CAPE differentiates itself through its unique Shiller CAPE index methodology and monthly sector rotation, aiming to provide a distinct exposure that balances undervaluation with positive price trends. The ongoing shift from active management to lower-cost, transparent ETF structures further supports the growth potential for products like CAPE within the financial services sector.

Who Are CAPE's Key Customers?

• Institutional investors seeking diversified U.S. equity exposure with a value and momentum tilt.
• Financial advisors and wealth managers constructing client portfolios with smart beta allocations.
• Retail investors looking for a systematic, rules-based approach to U.S. equity sector investing.
• Investors interested in cyclically adjusted valuation strategies to potentially mitigate market volatility and enhance long-term returns.

CAPE Financials

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DoubleLine Shiller CAPE U.S. Equities ETF Financials Stock: Key Questions Answered

Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.

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