Magoon explained how asset flows into Amplify’s suite of ETFs in the first half of 2023 were contrary to market performance. While growth stocks were leading the market in performance, asset flows were much stronger into the firm’s more conservative and value-titled ETFs.
On the growth side, Magoon discussed the Amplify Transformational Data Sharing ETF (BLOK). In 2018, BLOK was one of the first ETFs investing in blockchain and crypto-related equities. Investors may have differing short-term and long-term views regarding crypto-related equities. In the short term, they may be worried about the risk while still believing in the sector’s long-term potential.
Amplify’s value-oriented and income-generating ETFs include the Amplify CWP Enhanced Dividend Income ETF (DIVO) and the Amplify International Enhanced Dividend Income ETF (IDVO). After being named as a finalist for the 2022 ETF of the year, DIVO has experienced strong flows this year. These two ETFs are actively managed, seeking to purchase stocks with increasing earnings and dividends while tactically writing covered call options on a portion of the holdings. Including both dividends and options premium, DIVO distributes approximately 5% income while IDVO distributes approximately 6%. High-quality international stocks have attractive valuations and higher dividend yields relative to US stocks. In an environment of a weakening dollar, currency risk may give a return advantage to international stocks over US stocks.