LQAI Profile
The Exchange Listed Funds Trust - LG Qraft AI-Powered U.S. Large Cap Core ETF (LQAI) is the result of a strategic partnership between LG, the renowned South Korean electronics giant, and Qraft Technologies, a leader in artificial intelligence (AI) applications for financial markets. This ETF leverages cutting-edge AI technology to construct a portfolio of U.S. large-cap stocks, while also benefiting from the oversight and strategic input of the fund's adviser. The AI system is designed to detect and analyze patterns across a wide array of market factors, providing a sophisticated and data-driven approach to stock selection that aims to optimize returns in the dynamic U.S. equity market.
LQAI’s investment strategy centers around five key market factors: quality, size, value, momentum, and volatility. The proprietary AI system assesses the influence of these factors on individual companies, selecting the top 100 stocks based on their relative strength in terms of price appreciation. This multifactor approach ensures a balanced exposure to different aspects of the market, positioning the fund to capitalize on opportunities across various sectors and market conditions. By focusing on stocks with superior factor scores, LQAI aims to identify companies that are likely to outperform their peers in the near term.
One of the defining characteristics of LQAI is its frequent portfolio updates, driven by the AI’s monthly recalibration of data and market analysis. This results in a relatively high portfolio turnover, as the fund continuously adapts to changing market conditions and repositions itself to maintain optimal exposure to the selected factors. To manage risk and ensure diversification, the fund restricts single company weightings to a maximum of 10%, with an aggregate cap of 40% on securities that individually exceed a 5% weighting. This disciplined approach to weighting helps to mitigate the potential impact of any single stock on the overall portfolio’s performance.
While the ETF’s investments are heavily guided by the advanced recommendations generated by Qraft’s AI system, the final decision-making authority remains with the fund's adviser, who ensures that the AI’s outputs align with broader investment objectives and risk management strategies. LQAI is designed for investors seeking exposure to U.S. large-cap equities with the added benefit of AI-driven insights, offering a dynamic and forward-looking approach to equity investing. However, potential investors should be aware of the fund’s active trading nature, which may result in higher transaction costs and tax implications, as well as the inherent risks associated with reliance on AI-driven investment strategies.
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