Tag Archives: etf

Netflix U.S. Subscriber Targets Are Too Aggressive, Analyst Says

Wall Street’s consensus estimate for Netflix ( NFLX ) domestic subscriber growth this year appears too aggressive, ITG Investment Research analyst Corey Barrett said in a report Monday. International subscriber growth estimates, on the other hand, look conservative, he said. “The net effect of slowing domestic churn improvements and gross addition velocity is likely to drive domestic streaming net subscriber additions below consensus in 2016,” he said. ITG is modeling Netflix to add 4.4 million U.S. subscribers this year, vs. the consensus estimate of 4.8 million. For 2017, ITG forecasts Netflix to add 3.8 million domestic subscribers, vs. consensus views of 4.5 million. Also, the percentage of Netflix domestic gross subscriber additions that have had the service before increased to 65% in Q4, up from 55% in Q4 2013. The pool of “Netflix-nevers,” people who have never been Netflix subscribers, is rapidly shrinking, he said. But Netflix’s international growth prospects are underappreciated, Barrett said. ITG predicts that Netflix will add 15.6 million net new international subscribers in 2016, above the consensus estimate of 14.4 million. For 2017, ITG expects Netflix to add 15.4 million international subscribers, vs. consensus views of 14.5 million. “We believe the company can leverage the scale advantage and apply the content expertise it has domestically to its international markets, creating a significant competitive advantage in international markets,” Barrett said. “We view Netflix as the future of global video distribution, but believe Netflix is more likely than not to fall short of investor expectations for 2016 subscriber growth.” Netflix ended 2015 with 74.76 million streaming video subscribers worldwide. Of those, 44.74 million, or 60%, are in the U.S. Netflix is having a big impact on the traditional TV business in the U.S. Last year, Netflix accounted for about half of the overall 3% decline in TV viewing time among U.S. audiences, according to a new study by Michael Nathanson of MoffettNathanson, Variety reported . RELATED: Surveys Show Netflix Winning In U.S., Slow Going In Japan .

Strategic Asset Management Launches New Global Long/Short Fund

The long/short “hedged” fund was pioneered in the late 1940s in response to the economic tumult of the prior two decades. The idea behind it was to reduce exposure to the fluctuations of the “market” by partially offsetting long positions with short ones. If the stock picker was good, this meant the fund could outperform during bull and bear markets, and the downside during the latter would be mitigated. Strategic Asset Management’s First Fund Global long/short equity funds take things a step further than Alfred Jones, “hedged” fund originator, was able to take them in 1949, when investors were largely constrained by national borders. Rather than limiting themselves to U.S. equities, global long/short equity funds are open to investments from all over the world, and the Strategic Global Long/Short Fund (MUTF: SGFAX ), just launched on February 23, employs this strategy with a split “value/growth” approach. The new fund is advised by Strategic Asset Management, Ltd., a Cayman Islands corporation, and its portfolio manager is Mauricio Alvarez, Chief Executive Officer of the Adviser. This appears to be the company’s first U.S. mutual fund. The fund’s investment objective is twofold: First, to provide attractive returns through a combination of long-term capital appreciation and current income. Secondarily, to preserve capital in down markets. In pursuit of these objectives, the fund takes long and short positions in U.S. and foreign equities across all capitalization levels, with at least 40% of assets invested in companies generating a majority of their revenue outside the U.S. Global Long/Short Exposure The fund’s long exposure is expected to range from 100% to 140%, with the use of leverage; while its short exposure is expected to range from 0% to 40%. This will leave the fund with a relatively high beta compared to other long/short equity funds. The average beta, relative to the S&P 500 Index, for funds with a track record of 3-years or more is 0.53. On the long side, a “top-down” security selection process is used to identify undervalued equities and/or equities with favorable growth characteristics. On the short side, the fund focuses more keenly on firms with deteriorating growth. Currently, the fund is available in A-class shares only, which have a 1.97% net-expense ratio and a $1,000 initial minimum investment. The prospectus also refers to C-class shares, but doesn’t list a ticker symbol. Their intended net-expense ratio is 2.72%, and they have the same $1,000 initial minimum. For more information, view the fund’s prospectus .

ETFs For Quick Profits From The Oil Rebound

Oil has been showing immense strength in recent weeks with prices bouncing from their recent lows. In fact, the price of oil jumped over 9% last week, with U.S. crude currently hovering above $36 per barrel and Brent oil trading above $39 per barrel at the time of writing. With this, U.S. crude prices are up nearly 33% and Brent oil is up 27% from their 12-year lows hit in mid-February. Inside The Surge The impressive gains came on the back of improving demand/supply dynamics, which are rebuilding investors’ lost confidence in the rebalancing of the oil market. First, talks over a deal by major oil producers to freeze oil output at the January level infused an air of optimism. Second, output from the Organization of the Petroleum Exporting Countries (OPEC) dropped by 79,000 barrels per day last month while U.S. production slipped by 25,000 barrels per day for the week ending February 26. The positive weekly data from oil services firm Baker Hughes (NYSE: BHI ), which showed that the number of rigs fell to the lowest level since December 2009, also supported the rally in oil price as it reflects that U.S. output will continue to decline in the coming weeks. Finally, the International Energy Agency (IEA) projects a sharp decline in oil production to 4.1 million barrels a day over the 2015 through 2021 period from 11 million barrels a day during 2009-2015. This is because a slew of capital spending cuts last year and another round of major cuts this year will continue to curb oil production and reduce global supply, and thereby lead to higher oil prices. On the demand front, the global outlook is looking bright. Abating fears of a recession in the U.S. following the recent encouraging data, and renewed optimism of growth in China, Europe and Japan could drive oil demand in the coming months. Given the fresh round of optimism and signs that the oil market may begin to tighten, many investors have turned bullish on the energy sector and are seeking to tap this opportunity. How to Play? For them, a leveraged play on energy could be an excellent idea as these could lead to huge gains in a very short time frame when compared to the simple products. Below, we have highlighted five leveraged energy ETFs that could be excellent picks for investors seeking to make large profits from the energy space in a short span: Direxion Daily Energy Bull 3x Shares ETF (NYSEARCA: ERX ) This fund creates a triple (3x or 300%) leveraged long position in the Energy Select Sector Index while charging 95 bps in fees a year. It is a popular and liquid option in the energy leveraged space with AUM of $545.2 million and average trading volume of 4.2 million shares. The ETF gained 20.1% over the past one week. ProShares Ultra Oil & Gas ETF (NYSEARCA: DIG ) This ETF seeks to deliver twice (2x or 200%) the daily performance of the Dow Jones U.S. Oil & Gas Index. It has been able to manage $151.4 million in its asset base with trades in a good volume of more than 302,000 shares per day on average. The product was up 12.9% in the same time frame. Direxion Daily S&P Oil & Gas Exploration & Production Bull 3x Shares ETF (NYSEARCA: GUSH ) This fund offers triple exposure to the daily performance of the S&P Oil & Gas Exploration & Production Select Industry Index. It has accumulated $47.7 million in its asset base since its inception in late May 2015. Average daily volume is solid at around 913,000 shares while expense ratio is 0.95%. The product gained 57.7% over the past five trading sessions. ProShares Ultra Oil & Gas Exploration & Production ETF (NYSEARCA: UOP ) This product also tracks the S&P Oil & Gas Exploration & Production Select Industry Index, but offers twice the returns of the daily performance with the same expense ratio as that of GUSH. It has AUM of just $0.8 million and trades in a paltry volume of 2,000 shares. UOP was up over 28% in the same time frame. Direxion Daily Natural Gas Related Bull 3x Shares ETF (NYSEARCA: GASL ) This product seeks to deliver thrice the daily performance of the ISE Revere Natural Gas Index, which derives a substantial portion of its revenues from the exploration and production of natural gas. The fund has amassed $55.1 million in AUM and trades in heavy average daily volume of 2.2 million shares. Expense ratio comes in at 0.95%. The fund delivered whopping returns of 88.6% in the past five trading sessions. Bottom Line As a caveat, investors should note that these products are extremely volatile and suitable only for short-term traders. Additionally, the daily rebalancing – when combined with leverage – may make these products deviate significantly from the expected long-term performance figures. Still, for ETF investors who are bullish on the energy sector for the near term, either of the above products can be an interesting choice. Clearly, a near-term long could be intriguing for those with high-risk tolerance, and a belief that the “trend is the friend” in this corner of the investing world. Original Post