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FNG: January 2019 Portfolio Manager Review

Performance data quoted represents past performance and is no guarantee of future results. Current performance may be lower or higher than the performance data quoted. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than original cost. Returns less than one year are not annualized. For the fund’s most recent standardized and month-end performance, please click www.advisorshares.com/fund/fng.

Portfolio Review

For the month of January the New Tech and Media ETF (FNG) was up 5.66% compared to a gain of 8.01% in the S&P 500 and gain of 9.11% in the NASDAQ. The “FANG” stocks (Facebook, Amazon, Netflix, Google) were up 19.84% for the month.

One of the bigger winners for the FNG fund in the month of January was OKTA Inc. (NASDAQ: OKTA) which we are currently up 17.15% at the end of the month and looking to hold into earnings come the middle of February. We were also very bullish on a few cloud based names like TWLO, MSFT, and BABA which we had returns of 3-8% and currently still hold. 

We continue to closely watch the Chinese names along with the continual negotiations between the US & China. We still are holding SINA, up 10.11% and BABA up 12.85%.

Another larger position we held throughout the month was Amarin Corp (AMRN) with holding percentages of 6-12% during January. We still are very positive on the company and the game changing results from their Reduce-It trial. There are a few catalysts to come in the next two months with the ACC 2019 conference (American Congress of Cardiology) in which AMRN will be speaking and discussing the benefits of Vascepa. They also have their earnings call 3/1 and an sNDA (supplemental New Drug Application) proposal for label expansion from the Reduce-it results to the FDA. Again, we feel this new medicine/technology will be a huge disruptor in the space.

Overall, the month of January was stronger with the markets coming out of the correction in December. We saw the Federal Reserve become more dovish, withholding another rate hike. We started seeing some earnings roll out with strong numbers indicating a substantial slowdown has not been affecting too many companies domestically compared to other global economies and their companies. 

Moving into February we increased our weightings into the core based FANG names.

Top 10 Holdings

Ticker Security Description Portfolio Weight %
AMZN AMAZON.COM INC 15.63%
AMRN AMARIN CORP PLC -ADR 8.14%
TWLO TWILIO INC – A 7.42%
MSFT MICROSOFT CORP 6.83%
MEET MEET GROUP INC/THE 5.14%
AEYE AUDIOEYE INC 4.78%
OKTA OKTA INC 4.67%
GOOG ALPHABET INC-CL C 4.51%
YY YY INC-ADR 4.49%
AMD ADVANCED MICRO DEVICES 3.45%

As of 01.31.2019.

 

Respectfully,

Scott Freeze, CIO
Sabretooth Advisors
AdvisorShares New Tech and Media ETF (FNG) Portfolio Manager

 

Past Manager Commentary

Definitions:

The S&P 500 Index is a broad-based, unmanaged measurement of changes in stock market conditions based on the average of 500 widely held common stocks. One cannot invest directly in an index.

The Nasdaq Composite Index is the market capitalization-weighted index of approximately 3,000 common equities listed on the Nasdaq stock exchange.


Before investing you should carefully consider the Fund’s investment objectives, risks, charges and expenses. This and other information is in the prospectus, a copy of which may be obtained by visiting www.advisorshares.com. Please read the prospectus carefully before you invest. Foreside Fund Services, LLC, distributor.

There is no guarantee that the Fund will achieve its investment objective. An investment in the Fund is subject to risk, including the possible loss of principal amount invested. When the Fund focuses its investments in a particular industry or sector, financial, economic, business, and other developments affecting issuers in that industry, market, or economic sector will have a greater effect on the Fund than if it had not done so. Market or economic factors impacting technology companies and companies that rely heavily on technological advances could have a major effect on the value of the Fund’s investments. Shares of the Fund may trade above or below their net asset value (“NAV”). The trading price of the Fund’s shares may deviate significantly from their NAV during periods of market volatility. There can be no assurance that an active trading market for the Fund’s shares will develop or be maintained. In addition, equity markets tend to move in cycles which may cause stock prices to fall over short or extended periods of time. Other Fund risks include market risk, liquidity risk, large cap, mid cap, and small cap risk. Please see prospectus for details regarding risk.

Shares are bought and sold at market price (closing price) not NAV and are not individually redeemed from the Fund. Market price returns are based on the midpoint of the bid/ask spread at 4:00 pm Eastern Time (when NAV is normally determined), and do not represent the return you would receive if you traded at other times.

Holdings and allocations are subject to risks and to change.

The views in this commentary are those of the portfolio manager and may not reflect his views on the date this material is distributed or any time thereafter. These views are intended to assist shareholders in understanding their investments and do not constitute investment advice.