Amplify Samsung SOFR ETF (SOFR) 4th Quarter Commentary 2024
Amplify Samsung SOFR ETF (SOFR) is an actively managed strategy aimed to provide current monthly income and reduce risk exposure. SOFR ETF seeks to closely replicate the performance of the Secured Overnight Financing Rate, as published by the Federal Reserve Bank of New York. The Secured Overnight Financing Rate is a broad measure of the cost of borrowing cash overnight collateralized by treasury securities.
As of 12/31/2024, SOFR had a net asset value (NAV) return of 1.16% for the fourth quarter (Q4), 5.21% for 1 year, and 5.25% since inception (11/15/2023). View Standardized Performance.
Distribution Rate/Yield as of 12/31/2024
Distribution Rate*: 4.63%
30-Day SEC Yield**: 4.55%
Distribution Frequency: Monthly
Prospectus
Fund inception date: 11/15/2023. Total expense ratio is 0.20%. The performance data quoted represents past performance and does not guarantee future results. There is no guarantee that distributions will be made. *Distribution Rate is the normalized current distribution (annualized) over NAV per share. In addition to net interest income, distribution on 12/31/2024 included an estimated return of capital of 3%. See Form 19a-1. **30-Day SEC Yield is a standard yield calculation developed by the Securities and Exchange Commission that allows for fairer comparisons among bond funds. It is based on the most recent month end. This figure reflects the income earned from dividends – excluding option income – during the period after deducting the Fund’s expenses for the period.
Despite the accommodative monetary policy environment driven by continued rate cuts, concerns about potential market liquidity shortages have emerged as the Fed continues its Quantitative Tightening (QT) measures. By year-end, the SOFR rate rose off of the lows to end at 4.49%, while the Fed’s reserve balances decreased to the $3 trillion level.
However, this was a temporary phenomenon mainly caused by banks reducing lending activities to meet year-end regulatory requirements, and no unusual signs were observed in the short-term funding market. While the current trend of declining reserves may continue, it is anticipated that the Fed will continue to supply liquidity by halting QT if necessary.
Following the December Federal Open Market Committee (FOMC), where the Fed projected a slower pace of rate cuts in 2025, the SOFR rate is expected to remain at higher levels than initially anticipated. Additionally, SOFR ETF’s investment appeal remains as equity and bond market volatility expands due to policy uncertainty risks associated with the new administration.
This material is preceeded or accompanied by a prospectus.
Investment return and principal value of an investment will fluctuate so that an investor’s shares, when sold or redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month-end please visit AmplifyETFs.com/SOFR. Brokerage commissions will reduce returns. A fund’s NAV is the sum of all its assets less any liabilities, divided by the number of shares outstanding. The closing price or market price is the most recent price at which the fund was traded.
Investing involves risk, including the possible loss of principal. You could lose money by investing in the Fund. There can be no assurance that the Fund’s investment objectives will be achieved. The Fund is new with limited history to evaluate. There is no assurance that SOFR, or rates derived from SOFR, will perform in the same or similar way as other more established rates would have performed at any time. The Fund’s use of financial instruments involving counterparties, including swap arrangements, involves risks that are different from those associated with ordinary portfolio securities transactions. The Fund expects to invest principally in repos (Repurchase Agreements). If the seller fails to repurchase the security and the market value of the security declines, the Fund may lose money.
There is risk that the value of assets or income from investments will be less in the future as inflation decreases the value of money. The Fund may hold certain investments that may trade over-the-counter, trade in limited volume, or lack an active trading market. The Fund is subject to management risk because it is an actively managed portfolio. The Fund currently has fewer assets than larger funds, and like other new funds, large inflows and outflows may impact the Fund’s market exposure for limited periods of time. Because the Fund is non-diversified, it can invest a greater portion of its assets in securities of individual issuers so that changes in the market value could cause greater fluctuations in Share price than would occur in a diversified fund.
Amplify Investments LLC is the Investment Adviser to the Fund, and Samsung Asset Management (New York), Inc. serves as the Investment Sub-Adviser. Amplify ETFs are distributed by Foreside Fund Services, LLC.
Carefully consider the Funds’ investment objectives, risk factors, charges, and expenses before investing. This and additional information can be found in Amplify Funds statutory and summary prospectus, which may be obtained by calling 855-267-3837 or by visiting AmplifyETFs.com. Read the prospectus carefully before investing.
Investing involves risk, including the possible loss of principal. Shares of any ETF are bought and sold at market price (not NAV), may trade at a discount or premium to NAV and are not individually redeemed from the Fund. Brokerage commissions will reduce returns.
Amplify ETFs are distributed by Foreside Fund Services, LLC.