The SonicShares Global Shipping ETF (NYSE ARCA:BOAT) is designed to give investors access to a diverse group of companies involved in the global water transportation industry. This is achieved through a rules-based index that identifies and tracks companies engaged in shipping and related activities.
Typically, the fund will allocate at least 80% of its net assets, plus any borrowings for investment purposes, to Global Shipping Companies. This means that the majority of the fund's investments will be in companies that operate in the shipping industry, such as cargo shipping lines, tanker operators, and logistics providers.
In addition to investing in companies included in the index, the fund's investment adviser may also invest in other securities or investments that are not part of the index. However, these investments will be made with the goal of helping the fund track the performance of the index as closely as possible.
It's worth noting that the SonicShares Global Shipping ETF is a non-diversified fund. This means that the fund's investments may be concentrated in a smaller number of companies or industries, which can increase the risk of losses if those companies or industries experience difficulties. However, this approach can also allow the fund to capitalize on opportunities in the shipping industry and provide investors with more targeted exposure to this sector.