VUG - CAML: New Large-Cap Growth ETF Lags Out The Gate But Can It Recover?

2024-07-18 20:44:32 ET

Summary

• On August 21, 2023, Congress Asset Management launched CAML, an ETF that follows a similar strategy as its well established large-cap growth mutual fund. CAML's expense ratio is 0.65%.
• CAML has lagged behind its large-cap growth peers since its inception, but most is attributed to 5-6% underweighting of Nvidia. Otherwise, the long-return returns of Congress' mutual fund is solid.
• Still, I expected better growth and quality metrics, considering that's what Congress Asset Management advertises. In addition, CAML's P/E ranks only in the third quartile among large-cap growth ETFs.
• I appreciate CAML's diversified approach to stock selection, but after considering its expense ratio and weaker fundamentals, I don't believe it's necessarily a better choice. Therefore, I've assigned a "hold" rating.

Investment Thesis

The actively managed Congress Large Cap Growth ETF ( CAML ) launched on August 21, 2023, and is already lagging well behind low-cost peers like the SPDR S&P 500 Growth ETF ( SPYG ) and the Schwab U.S. Large-Cap Growth ETF ( SCHG ) by 8-11%. With a 0.65% expense ratio, you might wonder why one would consider CAML an option. ...

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