(THTA) Tidal Trust - Ratings and Ratios

The Tidal ETF Trust (NYSE ARCA:THTA) is an exchange-traded fund that employs a unique investment strategy to generate enhanced yield by combining a portfolio of U.S. Treasury Bills and/or U.S. Treasury Bonds with a credit spread option strategy. This approach allows the fund to potentially benefit from the stability of government securities while leveraging options to boost returns.

The funds asset allocation is typically divided into 2-5% Cash and cash equivalents, 95-100% Treasury securities, and up to 90% Credit Spreads, indicating a significant emphasis on credit spread options. The portfolios duration is targeted to be approximately one year, suggesting a relatively short-term investment horizon. ZEGA Financial, LLC, the funds sub-adviser, aims to generate annual interest income and capital gains through this strategy.

As a non-diversified ETF, THTA may have a more concentrated portfolio, which can increase its vulnerability to market fluctuations. However, its focus on U.S. Treasury securities provides a level of creditworthiness and liquidity. The funds Assets Under Management (AUM) stand at $35.49M USD, indicating a relatively small but still operational scale.

From a technical analysis perspective, the funds last price is $14.92, with a 20-day Simple Moving Average (SMA) of $14.79, indicating a slight upward trend. The 50-day SMA and 200-day SMA are $15.98 and $17.34, respectively, suggesting a longer-term downtrend. The Average True Range (ATR) is 0.32, or 2.15% of the last price, indicating moderate volatility. Given the current technical indicators, it is likely that the fund will continue to experience fluctuations, potentially testing the 52-week high of $18.72 or low of $12.84.

Forecasting the funds performance, we can expect that the combination of U.S. Treasury securities and credit spread options will continue to drive its returns. Assuming interest rates remain relatively stable and credit spreads continue to be favorable, the fund may be able to maintain its yield enhancement strategy. However, if market volatility increases or credit spreads widen, the funds performance may be negatively impacted. Based on the current technical and fundamental data, a potential price target for THTA could be around $16.50, representing a 10% increase from the current price, although this is subject to various market and economic factors.