ALTL - ALTL: 42% Win Rate Signals It's Time To Exit
2024-07-12 08:20:23 ET
Summary
- ALTL is a market-timing ETF alternating between high-beta and low-volatility strategies, represented by SPHB and SPLV, based on a proprietary relative strength signal.
- Since its inception, it's substantially lagged behind SPY, logging an unimpressive 42% win rate over the last 50 months. ALTL has done little to justify its 0.61% expense ratio.
- Besides the poor win rate, SPHB and SPLV are sub-optimal single-factor choices that come with significant growth and quality sacrifices.
- With $488 million in negative fund flows in the last year and a poor track record, I don't expect ALTL will last much longer. Instead, I'll highlight a multi-factor ETF that has a much better chance at outperforming SPY.
- ALTL is a "strong sell".
Investment Thesis
I last reviewed the Pacer Lunt Large Cap Alternator ETF ( ALTL ) on April 6, 2023, concluding that readers should avoid it because its 48% success rate at the time did not justify its excessive 0.60% expense ratio. Unfortunately, results have only worsened, with ALTL delivering a -3.21% total return loss compared to a 39.61% gain for the SPDR S&P 500 ETF ( SPY ). The BlackRock U.S. Equity Factor Rotation ETF ( DYNF ) performed best, which I'm excited to highlight later....
ALTL: 42% Win Rate Signals It's Time To Exit