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Kevin O'Leary's OUSA: Why It Doesn't Belong In Your Portfolio


  • Quality might be in the name, but low volatility is the real theme, and investors should be cautious if considering OUSA as a core holding.
  • Despite a pandemic that has re-shaped global markets, fund managers felt it necessary to add just 6.26% worth of new holdings when it reconstituted in September.
  • Unfortunately, the added stocks underperformed the deleted stocks by 4.87% since the reconstitution, putting into question the fund's stock-picking abilities.
  • While OUSA's current sector allocations are reasonable, this article will demonstrate why low-volatility stocks are the last thing you should want once markets bottom out.
  • I'm neutral only because of its high allocations to Consumer Staples and Health Care stocks, but am recommending investors avoid OUSA so they aren't caught in a bad market cycle.

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Investment Thesis

Nearly six years ago, Kevin O'Leary launched the O’Shares U.S. Quality Dividend ETF (BATS:OUSA) in what remains a crowded U.S. dividend ETF space. The strategy focuses on stocks with good dividend growth

This article was written by

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Build sustainable portfolio income with premium dividend yields up to 10%.

I perform independent fundamental analysis for over 850 U.S. Equity ETFs and aim to provide you with the most comprehensive ETF coverage on Seeking Alpha. My insights into how ETFs are constructed at the industry level are unique rather than surface-level reviews that’s standard on other investment platforms. My deep-dive articles always include a set of alternative funds, and I am active in the comments section and ready to answer your questions about the ETFs you own or are considering.

My qualifications include a Certificate in Advanced Investment Advice from the Canadian Securities Institute, the completion of all educational requirements for the Chartered Investment Manager (CIM) designation, and a Bachelor of Commerce degree with a major in Accounting. In addition, I passed the CFA Level 1 Exam and am on track to become licensed to advise on options and derivatives in 2023. In November 2021, I became a contributor for the Hoya Capital Income Builder Marketplace Service and manage the "Active Equity ETF Model Portfolio", which as a total return objective. Sign up for a free trial today! Hoya Capital Income Builder.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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