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A New ETF (IWIN) to Fight Inflation Hits Market

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Amplify, has recently launched its first exchange-traded fund (ETF) the Amplify Inflation Fighter ETF IWIN. The launch seems perfectly timed as the developed world is striving to beat sky-high inflation currently.

The annual inflation rate in the United States accelerated to 7% in December 2021 — a new high since June 1982 — in line with market expectations and compared with 6.8% in November.

No wonder, the new ETF launch is a timely one and may amass considerable assets in the near term. Let’s delve a little deeper.

Inside IWIN

IWIN is an actively-managed ETF, investing in asset classes that look to benefit, either directly or indirectly, from inflation. IWIN intends to provide investors with long-term capital appreciation in inflation-adjusted terms.

The portfolio includes an active mix of asset miners (21.29%), commodities (20.33%), land development (19.93%), homebuilders (15.97%), commodity REITs (12.05%) and real estate technology (10.43%). Among the commodities, bitcoin gets the major share (29.89%), followed by gold (24.87%), broad-based (20%), corn (15.1%) and copper (10.14%).  The expense ratio of IWIN is 0.85%.

There are 54 securities in the fund. Grayscale Bitcoin (6.56%), World Gold Tr Spdr Gld Minis (5.15%) and Invesco Actively Manged Etc Fund T Optimum Yield (4.18%) are the top three holdings of IWIN.

How Does It Fit in a Portfolio?

Commodities are often viewed as a hedge against inflation. Moreover, higher inflation is feared to weaken corporate earnings, which in turn, would hurt equity prices. In such a scenario, commodities may gain as an alternative investment.

Owning real estate during times of inflation because the purchase is a “one-time outlay” for the investor, does not incur recurring costs and involves resale value. In a rising-inflation environment, real estate stocks act as good bets. Both, resale value of the property and rental income rise with price inflation (read: ETF Strategies to Beat Inflation & Follow Warren Buffett).

Plus, the latest uptick in home prices is a boon for renters. Along with some analysts, we too believe that fast-rising home prices are likely to keep prospective homebuyers away from the ownership and direct them toward the rental market. If these were not enough, real estate and homebuilding stocks also offer higher yield.

Cyclical sectors tend to follow the economic cycle of expansion and recession. With the economy gaining momentum and inflation rising, these sectors are likely to fare well. Since IWIN offers exposure to the above-mentioned asset classes, the fund should be best-positioned in the current scenario.

Any Competition?

There are lot of products to beat inflation. Among TIPS, iShares TIPS Bond ETF (TIP - Free Report) is the most popular with an asset base of $35.16 billion. Among commodities, gold bullion ETFs like SPDR Gold Shares (GLD) is also a great bet. However, IWIN offers a mixed exposure where the product wins. AXS Investments, also recently launched its first ETF the AXS Astoria Inflation Sensitive ETF (PPI - Free Report) (read: Play This New ETF PPI to Beat Inflation).


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