RVER - RVER: Can This New Active GARP ETF Deliver On Its Bold Objective?
2025-04-15 22:01:09 ET
Summary
- This article initiates my coverage of the Trenchless Fund ETF by River1 Asset Management. RVER is actively managed with a 0.65% ER and typically holds only 12-25 stocks.
- Growth-at-a-reasonable-price is the main objective. RVER's managers select from a wide universe of stocks and have created a portfolio featuring twice the growth of SPY trading at the same valuation.
- However, RVER's current selections are extremely volatile, evidenced by the portfolio's 1.36 weighted average five-year beta. Their margins are also relatively weak, suggesting quality is not a key focus.
- While I understand the factor tradeoff, I don't buy RVER's claim that it can outperform SPY in both bull and bear markets. One year in, it's already trailing by 3%.
- Therefore, while RVER is an interesting play, I'm skeptical about how well it can perform in the long run. Therefore, I've assigned it a "hold" rating, and will compare it with four alternatives in the article below.