Amplify ETFs has launched a new thematic equity ETF targeting companies benefitting from the rise of online trading in securities and digital assets.
Christian Magoon, CEO of Amplify ETFs.
The Amplify Digital & Online Trading ETF (BIDS US) has been listed on NYSE Arca with an expense ratio of 0.59%.
Online-focused brokerage firms and digital asset marketplaces represent two fast-growing segments within the financial services industry; however, according to Amplify, these companies are often ignored by traditional financial sector benchmarks.
Lower trading costs, convenient user interfaces, and the rise of digital assets are some of the factors driving demand for online trading. Coupled with powerful yet accessible portfolio management tools, Amplify believes this demand is creating a compelling value proposition for both first-time and veteran investors.
Christian Magoon, CEO of Amplify ETFs, said: “Technological and investment service innovations are just beginning to democratize access to stocks, bonds, and digital asset classes around the globe. Modern investors have demonstrated their preference for convenient and low-cost access to online wealth management. BIDS seeks to capitalize on these trends, still in their infancy, with an eye toward continued market share growth across all investor segments.”
Methodology
The fund is linked to the BlueStar Global E-Brokers and Digital Capital Markets Index which selects its constituents from a universe of companies listed worldwide that have market capitalizations above $250 million.
The methodology screens for firms that derive at least 50% of their revenue from online brokerage, digital asset capital markets, trading platform technology, or market-making activities. The index selects the largest eligible companies, targeting a constituent count of 25 stocks.
Constituents are weighted by float-adjusted market capitalization while capping the weight of any single stock at 8% and the cumulative weight of online lending platforms at 20%.
The index is reconstituted semi-annually and rebalanced on a quarterly basis.
As of 20 September 2021, the index’s largest five positions were Robinhood, Schwab, Coinbase, MarketAxess, and SoFi Technologies.